One way of which has been proposed for sustaining high levels of contribution in voluntary contribution games is to allow participants to pay to punish free-riders. We believe that this is effective when A) Participants are not altruistic and so are willing to punish free riding. B) All of the other three statements are partial explanations, with participants being willing to punish free riding, potential free riders realising that adherence to the social norm is now the payoff maximising strategy, and the Nash equilibrium becoming adherence to the social norm. C) Participants who are tempted to reduce contributions anticipate future punishment and so conclude that they are better off maintaining contributions. D) Giving participants the ability to punish violation of a social norm means that adherence to the social norm becomes the Nash equilibrium of the game.
One way of which has been proposed for sustaining high levels of contribution in voluntary contribution games is to allow participants to pay to punish free-riders. We believe that this is effective when A) Participants are not altruistic and so are willing to punish free riding. B) All of the other three statements are partial explanations, with participants being willing to punish free riding, potential free riders realising that adherence to the social norm is now the payoff maximising strategy, and the Nash equilibrium becoming adherence to the social norm. C) Participants who are tempted to reduce contributions anticipate future punishment and so conclude that they are better off maintaining contributions. D) Giving participants the ability to punish violation of a social norm means that adherence to the social norm becomes the Nash equilibrium of the game.
Chapter8: Game Theory
Section: Chapter Questions
Problem 8.7P
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One way of which has been proposed for sustaining high levels of contribution in voluntary contribution games is to allow participants to pay to punish free-riders. We believe that this is effective when
A) Participants are not altruistic and so are willing to punish free riding.
B) All of the other three statements are partial explanations, with participants being willing to punish free riding, potential free riders realising that adherence to the social norm is now the payoff maximising strategy, and the Nash equilibrium becoming adherence to the social norm.
C) Participants who are tempted to reduce contributions anticipate future punishment and so conclude that they are better off maintaining contributions.
D) Giving participants the ability to punish violation of a social norm means that adherence to the social norm becomes the Nash equilibrium of the game.
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