Why punishment is worth it in the end

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Is punishment a destructive force that breaks societies or part of the very glue that holds them together? Last year, I blogged about two studies that tried to answer this question using similar psychological games. In both, volunteers played with tokens that were eventually exchanged for money. They had the option to either cooperate with each other so that the group as a whole reaped the greatest benefits, or cheat and freeload off the efforts of their peers.

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In both studies, giving the players the option to punish each other soon put a relative end to cheating. Faced with the threat of retaliation, most players behaved themselves and levels of cooperation kept stable. But this collaboration came at a heavy cost – in both cases, players ended up poorer for it. Indeed, one of the papers was titled “Winners don’t punish“, and its authors concluded, “Winners do not use costly punishment, whereas losers punish and perish.”

But in both these cases, the experiments lasted no more than 10 ’rounds’ in total, and to Simon Gaechter, that was too short. He reasoned that more protracted games would more accurately reveal the legacy of punishment, and more closely reflect the pressures that social species might experience over evolutionary time spans. With a longer version of the games used in previous studies, he ably demonstrated that in the long run, if punishment is an option, both groups and individuals end up better off. 

Together with colleagues from the University of Nottingham, Gaechter recruited 207 people and watched as they played a “public goods game” in groups of three. All of them were told that their group would remain the same for the entire game, which could last for either ten rounds or fifty.

To begin, he gave each player 20 tokens, who could keep or invest as many as they liked. Every token they kept retained its full worth, while every token that was invested halved in value but was worth that much to every player. So as is normal in these games, players earn more for themselves by cheating but more for the group by cooperating. In some games, they also had the option to punish each other, sacrificing one of their own tokens to rob someone else of three of theirs.

As in other studies, Gaechter found that people were more likely to cooperate with one another in games when they had the option to punish cheats. In the ten-round game, players who could punish contributed about 3.6 more tokens than those who couldn’t; in the fifty-round game, the effect was even greater and punishment increased the average contributions by 9.6 tokens.

After ten rounds, players who played a punishing game earned an average of 4.7 fewer tokens per round than their peers. Again, that matches the results of previous studies. But Gaechter found that things flipped around after fifty games – by that point, the punishers were earning about 3 more tokens per round.

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Even at their earliest stages, the fifty-round games were different. Armed with the knowledge that they were in it for the long-haul, the players changed tactics. In the first ten rounds, they gave more to the central pot and doled out smaller punishments than those who knew that their games would go no further. It paid off too – the long-haul players were raking in higher dividends just within the initial rounds. 

Things weren’t always so utopic though – the final and fiftieth round saw a massive drop in average earnings. By this point, people were just trying their luck or punishing with impunity. Gaechter argues that the experiment’s end doesn’t reflect real interactions very well, but I think it’s interesting to show what can happens to seemingly stable alliances when a deadline is placed on them.

Nonetheless, Gaechter’s suggests that the ability to punish freeloaders binds a group of people together and once this happens, the increasing gains from teamwork start to outweigh the diminishing costs of punishment. In the long run, both groups and individuals end up better off. So perhaps, winners can punish after all.

Reference: S. Gachter, E. Renner, M. Sefton (2008). The Long-Run Benefits of Punishment Science, 322 (5907), 1510-1510 DOI: 10.1126/science.1164744

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