Third-Party Punishment and Counter-Punishment in One-Shot Interactions

This paper presents experimental evidence from a simple three-person game showing that many individuals are willing to avenge third-party punishment in one-shot interactions. The threat of counter-punishment has a large negative effect on the willingness of third parties to punish selfish behavior. In spite of this, the extent of selfish behavior is identical to that in a treatment without counterpunishment opportunities. We discuss explanations for this puzzling finding