Cooperation in social dilemmas: Free riding may be thwarted by second-order reward rather than by punishment.

2008 ◽  
Vol 95 (4) ◽  
pp. 826-842 ◽  
Author(s):  
Toko Kiyonari ◽  
Pat Barclay
1994 ◽  
Vol 4 (3) ◽  
pp. 253-269 ◽  
Author(s):  
Edwin M. Hartman

Abstract:A complex organization is in effect a commons, which supervisory techniques cannot preserve from free riding. A corporate culture strong enough to create the requisite community-minded second-order desires and beliefs may be morally illegitimate. What morality requires is not local enforcement of foundational moral principles—a futile undertaking—but that the organization be a good community in that it permits the disaffected to exit, encourages reflective consideration of morality and the good life, and creates appropriate loyalty.


Author(s):  
Charlotte Rommerskirchen

Free riding is endemic. But it is not the type of first-order free riding that politicians and EU officials publicly chastised. Instead, fiscal policy coordination is burdened by a serious internal enforcement problem; that is, second-order free riding. The argument presented here is different from the usual decrying of a lack of enforcement in fiscal policy coordination, which is said to invite member states to engage in rampant fiscal free riding. This chapter contests that without internal enforcement within the EU, fiscal policy coordination has come to rely on market discipline with dire consequences for its members. The chapter demonstrates that, in contrast to fiscal rules and intergovernmental agreements, the incentives provided by market discipline shape public finances.


2015 ◽  
Vol 282 (1798) ◽  
pp. 20141994 ◽  
Author(s):  
Miguel dos Santos

Cooperation in joint enterprises can easily break down when self-interests are in conflict with collective benefits, causing a tragedy of the commons. In such social dilemmas, the possibility for contributors to invest in a common pool-rewards fund, which will be shared exclusively among contributors, can be powerful for averting the tragedy, as long as the second-order dilemma (i.e. withdrawing contribution to reward funds) can be overcome (e.g. with second-order sanctions). However, the present paper reveals the vulnerability of such pool-rewarding mechanisms to the presence of reward funds raised by defectors and shared among them (i.e. anti-social rewarding), as it causes a cooperation breakdown, even when second-order sanctions are possible. I demonstrate that escaping this social trap requires the additional condition that coalitions of defectors fare poorly compared with pro-socials, with either (i) better rewarding abilities for the latter or (ii) reward funds that are contingent upon the public good produced beforehand, allowing groups of contributors to invest more in reward funds than groups of defectors. These results suggest that the establishment of cooperation through a collective positive incentive mechanism is highly vulnerable to anti-social rewarding and requires additional countermeasures to act in combination with second-order sanctions.


2010 ◽  
Author(s):  
Robin P. Cubitt ◽  
Michalis Drouvelis ◽  
Simon Gachter ◽  
Ruslan Kabalin

2011 ◽  
Vol 95 (3-4) ◽  
pp. 253-264 ◽  
Author(s):  
Robin P. Cubitt ◽  
Michalis Drouvelis ◽  
Simon Gächter ◽  
Ruslan Kabalin

Author(s):  
Charlotte Rommerskirchen

Looking ahead, the legacy of the crisis years shapes fiscal policy coordination. The two main aspects of change considered in this chapter are purview and pliancy. First, fiscal policy has ceased to be defined in narrow ‘low-deficit’ targets and instead is set to encompass a twin notion of free riding: growth free riding and stability free riding. Second, fiscal policy coordination has become more flexible and as a result more adaptive to the challenges of sound public finances in the twenty-first century. While the institutional architecture for collective action has been strengthened, there is little reason to be optimistic as to the containment of endemic second-order free riding. Member states, this chapter argues, are continuing to rely on market discipline as the erratic enforcer of rules they are unable to bring to bear amongst themselves.


Nature ◽  
2005 ◽  
Vol 437 (7058) ◽  
pp. E8-E9 ◽  
Author(s):  
Karthik Panchanathan ◽  
Rob Boyd
Keyword(s):  

Author(s):  
William D. Ferguson

A society’s prospects for development depend on its ability to resolve collective-action problems (CAPs). Resolution depends on underlying institutional contexts. Inequality permeates these interactions. This chapter introduces CAPs, institutions, institutional systems, social orders, and political settlements. CAPs arise when individuals, pursuing their own goals, generate undesirable outcomes for some group. First-order CAPs concern forms of free riding; second-order CAPs concern orchestrating the coordination and enforcement that render agreements to limit free riding credible. Discussion proceeds to distinguish informal and formal institutions (norms and rules) from organizations (structured groups of individuals that can take action). Institutional systems are complementary mixes of institutions and organizations, where the latter play critical roles in resolving second-order CAPs. Social orders are large-scale institutional systems. Political settlements are mutual understandings that limit organized violence by addressing broad allocations of authority and benefits.


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