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American Economic Journal: Microeconomics: Vol. 3 No. 4 (November 2011)

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Intermediation Reduces Punishment (and Reward)

Article Citation

Coffman, Lucas C. 2011. "Intermediation Reduces Punishment (and Reward)." American Economic Journal: Microeconomics, 3(4): 77-106.

DOI: 10.1257/mic.3.4.77

Abstract

This paper shows moral decision making is not well predicted by the overall fairness of an act but rather by the fairness of the consequences that follow directly. In laboratory experiments, third-party punishment for keeping money from a poorer player decreases when an intermediary actor is included in the transaction. This is true for completely passive intermediaries, even though intermediation decreases the payout of the poorest player and hurts equity, and because intermediation distances the transgressor from the outcome. A separate study shows rewards of charitable giving decrease when the saliency of an intermediary is increased. (JEL A13, D63, D64)

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Authors

Coffman, Lucas C. (OH State U)

JEL Classifications

A13: Relation of Economics to Social Values
D63: Equity, Justice, Inequality, and Other Normative Criteria and Measurement
D64: Altruism

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