Socially Appropriate Intervention: A Cross-Country Investigation of Third-Party Norm Enforcement

Abstract

The enforcement of social norms is considered as a main motivation for third-party intervention. We provide direct evidence for this theory in a cross-country experimental trust game with a sender, a receiver, and a third party who can punish or reward the receiver at own cost. As a novelty we share a norm relevant information – the sender’s expectation – with the third party and manipulate the level of norm uncertainty by having the third party to interact with players from the same country versus from a different country. Our results suggest that third parties respond to the norm relevant information when deciding on the intervention, and more so when they intervene players from a different country. These results support the role of social norms in motivating third-party intervention.