Selective Incentives Research Articles

Research on Differences of Punishment and Reward: Evidence from Public Goods Experiments in the Stranger Condition

This paper examines the different effects of two alternative selective incentives, punishment and reward, on cooperation in public goods experiments. Our experiments employ a stranger condition, in order to eliminate effects of reputation and direct reciprocity. We also provide a comparative analysis by varying the effectiveness of punishment(reward), that is the amount by which a punishment(reward) point reduces(increases) the recipient’s payoff. Results show that, (1)at the collective level, the opportunities to punish would improve the cooperation if the effectiveness of punishment exceeds a certain threshold, and average contributions increases along with the effectiveness. However, the opportunities to reward is ineffective in facilitating cooperation, which is independent of the effectiveness of reward; (2)at the individual level, the opportunities to punish(reward) fails to induce the punished(rewarded) subjects’ consequent contributions except when the effectiveness of punishment(reward) equals “2”(“4”); (3)the payoffs in the reward treatments show a significant higher level than that in the punishment treatments with peer effectiveness except when the effectiveness equals “1”. To sum, we find results roughly similar to that in partner conditions at the collective level, but distinctly different at the individual level.

Relational Rewards and Communicative Planning: Understanding Actor Motivation

This article uses a collective action approach to analyse the risk of social dilemmas in communicative planning processes. If actors are self-interested and lack a predisposition to co-operation and communication, they may choose to free ride or under-contribute to the non-excludable outputs of voluntary communicative planning processes that lack reprisals for defection or under-contribution. To motivate their participation, actors must expect some exclusive additional reward. This analysis leads to a suggestion that communicative planning may create social capital networks that offer valuable relational rewards, in varying amounts, to some or all interdependent stakeholders. The value of relational rewards is their potential to reduce transaction costs in future collective actions. The expectation of relational rewards may be a selective incentive powerful enough to counteract the social dilemmas inherent in communicative planning processes in pursuit of normative goals such as inclusive-ness and diversity. However, the existence of relational rewards may facilitate strategic action as much as communicative action.

What Motivates Participation in Violent Political Action

In standard models of decision making, participation in violent political action is understood as the product of instrumentally rational reasoning. According to this line of thinking, instrumentally rational individuals will participate in violent political action only if there are selective incentives that are limited to participants. We argue in favor of an alternate model of political violence where participants are motivated by moral commitments to collective sacred values. Correlative and experimental empirical evidence in the context of the Israeli-Palestinian conflict strongly supports this alternate view.

Groups Reward Individual Sacrifice: The Status Solution to the Collective Action Problem

One of sociology's classic puzzles is how groups motivate their members to set aside self-interest and contribute to collective action. This article presents a solution to the problem based on status as a selective incentive motivating contribution. Contributors to collective action signal their motivation to help the group and consequently earn diverse benefits from group members–in particular, higher status–and these rewards encourage greater giving to the group in the future. In Study 1, high contributors to collective action earned higher status, exercised more interpersonal influence, were cooperated with more, and received gifts of greater value. Studies 2 and 3 replicated these findings while discounting alternative explanations. All three studies show that giving to the group mattered because it signaled an individual's motivation to help the group. Study 4 finds that participants who received status for their contributions subsequently contributed more and viewed the group more positively. These results demonstrate how the allocation of respect to contributors shapes group productivity and solidarity, offering a solution to the collective action problem.

Tactical Innovation, Democratic Governance, and Mixed Motives: Popular Movement Resilience in Peru and Ecuador

AbstractUrban popular movements that organize illegal land invasion communities present an intriguing puzzle. When most invasion organizations acquire land titles, their participation levels plummet and their agendas stagnate; yet some neighborhoods achieve land titles, sustain high participation, and acquire other services, such as piped-in water. Why do these organizations achieve movement resilience? The more typical trajectory of movement collapse is explained by the disappearance of the key selective incentive, property security. Some organizations, however, evade this “security trap” through mixed motives: their basic material agenda is supplemented by a nonmaterial and often altruistic agenda, which sustains participation in the face of reduced selective incentives. Examining three neighborhood case studies in Lima and Quito, this article argues that a new, “innovator” type of invasion organization is more likely to exhibit sustained participation and movement resilience due to tactical innovation, democratic governance, and mixed motives.

Variable Pay and Collective Bargaining: A Cross-National Comparison of the Banking Sector

This article analyses the challenge of variable pay to collective bargaining, based on a cross-national comparison that takes banking organizations in Austria, Norway, Spain and the UK as representatives of Europe's principal bargaining systems. The hypothesis is that the capacity of collective bargaining to govern variable pay varies with the bargaining system. As the findings show, articulated multi-employer bargaining is more able to govern variable pay than its unarticulated counterpart and single-employer bargaining. Within the case of articulated multi-employer bargaining, single-channel systems of employee workplace representation are superior to dual systems, all the more since the former equip the unions with selective incentives for membership.

Dynamics and Stability of Collective Action Norms

A set of computational experiments investigated a model of formal and informal control, showing how selective incentives to work for the collective good may paradoxically lead to enforcement of antisocial norms that oppose the collective good. In these conditions, the widely cited effects of selective incentives, group cohesiveness, and second-order free riding on collective action may be inverted. Mathematical analysis provides some certain bounds on the model's behavior and relaxes several restrictive assumptions used in the simulation research. This complementary view deepens our understanding of second order social control as a solution to problems of collective action.

Social preferences and private provision of public goods: A ‘double critical mass’ model

We set up an evolutionary game-theoretic model aimed at addressing the issue of local public good provision via direct commitment of voluntary forces (private donors and nonprofit providers) only. Two classes of agents are assumed to strategically interact within a ‘double critical mass’ model and we investigate the critical factors affecting the dynamic outcomes of such interaction. Further, we explore the conditions under which (what we term) ‘evolutionary crowding-out/in’ occurs, depending on agents’ degree of opportunism, social comparison and positive selective incentives (such as subsidies given by the government to ‘virtuous’ citizens or nonprofits only).

Party Loyalty and Legislative Success

Majority Party leaders are hypothesized, through their control of the legislative schedule in the House of Representatives, to use legislative success as a selective incentive to encourage majority party members to contribute to the collective goals of the party. Members can demonstrate party loyalty through floor voting and financial contributions to the party's re-election efforts. This article examines legislative success from the 103rd through 107th Congresses. The evidence shows that both demonstrations of party loyalty have a significant effect on legislative success.

A Collective Interest Model Approach to Explain the Benefit–Cost Expectations of Participating in a Collaborative Institution

What factors explain stakeholder benefit–cost expectations for participating in a collaborative institution? This article examines this question by applying a version of the collective interest model. The case study includes original data from a mail-in questionnaire and in-person interviews of stakeholders' expectations before the start of a collaborative process to establish marine-protected areas in California. The results provide little support for the traditional variables in the collective interest model with null results for group and personal efficacy. Selective incentives, especially putting in your own time versus company time, are important in explaining stakeholders' benefit–cost expectations. The results show that ally efficacy is an important factor, suggesting that perceptions of allies compared to opponents shape initial expectations for a collaborative process. This article adds to the research on political participation in environmental management by presenting a rare exploration of ex ante beliefs before the start of a collaborative planning institution.

Selective Incentives and Generalized Information Exchange

The goal of this research is to understand how generalized exchange systems emerge when information, as the object of exchange, produces a collective good. When individuals contribute information for a collective benefit, it can create a group-generalized exchange system that involves a social dilemma. I argue that two properties of information, replication and high jointness of supply, are crucial for understanding the nature of the social dilemma in these exchange systems. Combined with low-cost contributions, these special features of information can allow social psychological selective incentives to significantly encourage cooperation. Experiments were conducted to examine the independent effects of two social psychological selective incentives (social approval and observational cooperation) on sharing behavior in a generalized information exchange system. The results indicate that observing high levels of cooperative behavior is beneficial in the short run, but ultimately it only leads to moderately higher levels of cooperation than when individuals cannot observe cooperative behavior. On the other hand, when individuals receive either high or low levels of social approval, it has a very positive, significant impact on cooperative behavior. This research has implications for real-world generalized information exchange systems such as those found on the Internet. In addition, the theory and results in this study can also be extended to public goods that share the features of low-costs contributions, replication, and high jointness of supply.

Incentivizing Institutional Investors to Serve as Lead Plaintiffs in Securities Fraud Class Actions

By enacting the Private Securities Litigation Reform Act of 1995 (PSLRA), Congress sought to put institutional investors in charges of securities class actions. In an important respect, this effort has failed. Although pension funds for public sector employees and labor unions often volunteer to serve as lead plaintiffs, private institutional investors do not. The participation of public sector and union funds may also reflect political contributions and ideological beliefs, rather than the PSLRA. The passivity of private sector funds and the importance of ideology and political contributions as motivations for public sector and union funds reflects the incentives created by the PSLRA, which prohibits bonus payments for lead plaintiffs and encourages investors to free-ride. This Article sets out three possible amendments to the PSLRA designed to give investors of all types selective incentives to serve as lead plaintiffs. One would give lead plaintiffs bonuses tied to the size of their holdings. The second proposal would sell 20% of the class-wide recovery to the class member willing to pay the most for it, while also requiring the lead plaintiff to pay half the class' attorneys' fees from this portion. The third proposal would auction off 30% of the recovery, while requiring the lead plaintiff to pay 100% of the class' attorneys' fees. The second and third proposals would encourage lead plaintiffs to set class counsel's fees at efficient rates.

Collective Entrepreneurship: An Emerging Phenomenon in Producer-Owned Organizations

This paper introduces and defines the concept of collective entrepreneurship. A review of the defensive single-level rent-seeking objective of traditional agricultural cooperatives is introduced followed by an analysis of recent studies documenting a shift in the objective functions of producers jointly integrating toward more multiple-level rent-seeking entities. This process of shifting from market failure-ameliorating collective action mechanisms toward rent-seeking group action organizations is labeled collective entrepreneurship. The justification for introducing this concept is based on the Olsonian premise that rational, self-interested individuals will not act to achieve their common or group interests without coercion or selective incentives.

Varför bildas nya partier?

Why do people engage in high-cost political activities such as forming new political parties? Start-up costs are high. Moreover, rewards are unclear and uncertain. Since political parties are collective goods, people demanding new political parties face a collective action problem. It is therefore somewhat puzzling that new parties emerge. Drawing on theories from economics, sociology and political science, I argue that we, in order to understand the emergence of new parties, need to analytically move in on party-entrepreneurs to elucidate what motivates them. Methodologically inspired by the debate on bridging the gap between deductive and inductive strategies, I process-trace and compare three cases. The case studies identify individual level-mechanisms producing the decision toform a new party. People that voice demands within established parties, and face outright rejection, have experienced bad treatment from established politicians. These experiences contribute to disappointment, anger, and a sense of indignation - i.e. “intense emotions”- that mobilize entrepreneurs. Intense emotions create a lust for revenge, which becomes a psychological selective incentive, and is important for understanding why people engage themselves in high-cost political activities.

Cheating can stabilize cooperation in mutualisms

Mutualisms present a challenge for evolutionary theory. How is cooperation maintained in the face of selection for selfishness and cheating? Both theory and data suggest that partner choice, where one species preferentially directs aid to the more cooperative members of the other species, is central to cooperation in many mutualisms. However, the theory has only so far considered the evolutionary effects of partner choice on one of the species in a mutualism in isolation. Here, we investigate the co-evolution of cooperation and choice in a choosy host and its symbiont. Our model reveals that even though choice and cooperation may be initially selected, it will often be unstable. This is because choice reduces variation in the symbiont and, therefore, tends to remove the selective incentive for its own maintenance (a scenario paralleled in the lek paradox in female choice and policing in within-species cooperation). However, we also show that when variability is reintroduced into symbionts each generation, in the form of less cooperative individuals, choice is maintained. This suggests that the presence of cheaters and cheater species in many mutualisms is central to the maintenance of partner choice and, paradoxically, cooperation itself.

The Rationality of Radical Islam

Why do Islamist radicals engage in high-cost/risk activism that exposes them to arrest, repression, and even death? At a group level, it appears perfectly rational: zealous contention places enormous pressures on adversar ies and increases the likelihood that the group will achieve its objective. Robert Pape's study of suicide terrorism provides some empirical evidence that ex treme forms of activism do indeed produce concessions from opponents.1 Yet, although extreme tactics may be deployed as part of a logical, coherent, and strategy to maximize group goals, is it rational for the individual per petrators? Why not free-ride off the efforts of others rather than jeopardize personal self-interest? We argue that radical Islamic groups offer spiritual selective incentives to individuals who are concerned with the hereafter. Although some radical Is lamists are compelled by economic incentives or personal psychological needs that may have nothing to do with religious conviction (the need for revenge against perceived oppressors, a need for a sense of empowerment, or a desire for prestige), religion matters for many. In cases where individuals take spiri tuality seriously, movement ideologies offer strategies for fulfilling divine duties and maximizing the prospects of salvation on judgment day. In essence, these ideologies serve as heuristic devices or templates that outline the path to salvation. Where individuals believe that the spiritual payoffs outweigh the

Social Class and Delinquency

The frequently predicted relationship between social class and criminal behavior is theoretically vacillating and empirically exiguous. We present an extended rational choice model which integrates the effects of an individual’s social status on his or her subjective evaluations of (1) costs, (2) utility, (3) the probability of apprehension, (4) the selective incentives, and (5) the internalization of social norms. We test the model against the offences of shop-lifting and tax-evasion. The data source derived from the German General Social Survey empirically supports the theoretical model. There exists no prevalent relationship between an individual’s social status and his or her incentives towards criminal comportment. However, the social status of an individual affects the type of offences committed. The subjectively expected probability of either failing or succeeding in a criminal act takes greater precedence over the fear of retribution or the expected utility. Additionally, internalized norms decrease the probability of committing a crime.

Collective Action, Rival Incentives, and the Emergence of Antisocial Norms

Centralized sanctions (selective incentives) and informal norms have been advanced as distinct solutions to collective action problems. This article investigates their interaction, modeling the emergence of norms in the presence of incentives to contribute to collective goods. Computational experiments show how collective action depends on a three-way interaction among the value of incentives, the rivalness of incentives (ranging from independence to zero-sum competition), and group cohesiveness (effectiveness of peer influence). This investigation shows a broad range of conditions in which social norms promote the collective good and thus peer influence complements a centralized regime of selective incentives. It also shows conditions in which the two systems clash because incentives lead to antisocial norms that discourage contributions to collective goods. In these conditions, social scientists must reconsider the widely predicted relationships of collective action to selective incentives, group cohesiveness, and second-order free riding.

Salvation as a selective incentive

As club goods, religions face the problem of free riding. Smaller religious clubs, such as cults or sects, can often surmount this problem through communal pressures or by requiring their members to provide easily monitored signals. Generally, however, such tactics will be unavailable or too costly for large denominations, and, as such, these denominations must look for other techniques to avoid free riding. This paper argues that the Roman Catholic doctrine of justification by faith and works serves as an Olsonian selective incentive and presents empirical evidence in support of this claim. Specifically, I show that Catholics contribute significantly more to their churches as they approach death than do members of Protestant denominations. More generally, this paper suggests that church doctrines influence behavioral incentives, and religious leaders may be able to capitalize on these behavioral effects for the benefit of their church.

LOTTERIES AS A MEANS OF FINANCING FOR PRESERVATION OF THE GLOBAL COMMONS AND AGENT-BASED SIMULATION ANALYSIS

ABSTRACT In this paper, we deal with lotteries to finance the preservation of the global commons and we carry out simulations on an agent-based artificial society model. Focusing on the preservation of the global commons, such as the atmospheric quality, we show that financing by means of lotteries with selective incentives is effective, as compared to voluntary contributions without those incentives, when the condition of the global commons does not become excessively worse.