Cooperation can be induced by an authority with the power to mete out sanctions for free riders, but law enforcement is prone to error. This paper experimentally analyzes preferences for and consequences of errors in formal sanctions against free riders in a public goods game. With type I...

In this experiment, voters select a leader who can either act in the public interest, i.e. make efficient and equitable policy choices, or act in a corrupt way, i.e. use public funds for private gain. Voters can observe candidates' pro-social behavior and their score in a cognitive ability test...

Do democratically chosen rules lead to more cooperation and, hence, higher efficiency, than imposed rules? To discuss when such a "dividend of democracy" obtains, we review experimental studies in which material incentives remain stacked against cooperation (i.e., free-riding incentives prevail)...

We experimentally analyze the effect of endogenous group formation on the type of sanctioning institutions emerging in a society. We allocate subjects to one of two groups. Subjects play a repeated public goods game and vote on the sanctioning system (formal or informal) to be implemented in...