What Makes Law to Change Behavior? An Experimental Study
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Rustam Romaniuc
Abstract
The use of mild laws to affect people’s behavior is pervasive – from environmental regulation to tort law – but little is known about how the law changes human behavior and social outcomes when it uses non-deterrent monetary incentives. We find that when low monetary incentives are framed so as to indicate what is group desirable behavior, people behave more cooperatively in a public goods game than when no-incentives exist. However, we find that the effect is transitory. Surprisingly, the effect is long lasting when low monetary incentives are presented as payments for some neutral behavior – that is, when the fine is presented as a mere price change. Our findings suggest that the indication of what is group desirable behavior makes salient the conflict between people’s normative expectations and what others effectively do. This undermines conditional cooperators’ own motivation to contribute to public goods. Neutrally framed price-incentives have a long lasting positive effect on contribution decisions because it does not indicate what one should do and thus avoids the conflict with what others effectively do.
Funding statement: Montpellier Laboratory for Experimental Economics.
Acknowledgemets
I thank Dimitri Dubois for programing the experiment and for valuable remarks and suggestions at the design stage of this work. I am also grateful to Tim Cason, Cecile Bazart, Yuval Feldman, Lisette Ibanez, Stephane Luchini, Alain Marciano, Julie Rosaz, Marc Willinger, and to an anonymous referee for helpful remarks. I owe a special thanks to Remi Gaultier. The paper also benefited from comments by participants at the Montpellier Experimental Economics Workshop, the ASFEE meeting (PSE, 2015), and the Law and Economics Workshop at the University of Sassari (2015).
Appendix: Instructions (originally written in French)
General rules
The experiment in which you are going to participate is part of a study on decision-making. Please read the instructions carefully. These instructions are meant to help you understand the experiment. Once all of the participants have read the instructions, the experimenter will then reread the instructions aloud.
Your gains will depend on your decisions as well as the decisions of other participants. All of your responses will be anonymous and will be gathered via a software program. You will indicate your choices on the computer in front of which you are seated, and this computer will calculate the gains you have realized in the course of the experiment. The sum total of money gained during the experiment will be paid to you in cash at the end of the experiment. From this moment on, we ask you to refrain from speaking. If you have a question, please raise your hand and an experimenter will help you in private.
The experiment is composed of three parts. Each part is made up of several periods. The instructions for Part 2 will be distributed to you once Part 1 has been finished, and the instructions for Part 3 will be distributed once Part 2 has been finished. One of the three parts will be drawn at random for payment. Your gain for the experiment will be equal to the gain you obtained during this Part. In the three parts, the gains are expressed in ecus. The conversion rate of emus into euros is 15 ecus = 1 euro.
At the beginning of Part 1, the central computer will create groups of four at random. The composition of the groups will remain unchanged for the duration of the experiment. You will not be able to identify the other members of your group and they will not be able to identify you.
Part 1
This part is composed of ten periods. At the beginning of each period, you as well as the other three members of your group will have an amount of 20 tokens that you must allocate between two accounts: your individual account and a collective account belonging to all of the members of your group (you included). Specifically, you must decide on the number of tokens that you put in the collective account. The remaining tokens are automatically placed in your individual account. You are free to put any whole number of tokens between 0 and 20 into the account.
Individual account
Each token placed in your individual account earns you 1 ecu. And so, if for example, you put 6 tokens in your individual account, this will earn you 6 ecus. Your individual account only earns ecus for you alone.
The collective account
The collective account is shared by all members of your group. Each token placed in the collective account earns 0.4 ecus to each member of the group. Thus, if for example, you put 6 tokens in the collective account, this will earn 2.4 ecus for each member of the group (you included), amounting to a gain of 9.6 ecus for the entire group.
Gain
Your gain for the period is equal to the sum of the gains of your individual account and the collective account.
Example 1
You put 16 tokens in the collective account and thus 4 tokens in your individual account (put there automatically). Let us suppose that the three other members of your group put a total of 48 tokens in the collective account. In total, the collective account now comprises
Example 2
You put 3 tokens in the collective account and thus 17 tokens in your individual account. Let us suppose that the three other members of your group put a total of 40 tokens in the collective account. In total, the collective account now comprises
Final Details
All of the members of your group (you included) will make their decisions simultaneously. When all of the members of the group have made their decision, a summary screen will appear. The screen will remind you of the number of tokens that you have placed in each of the two accounts and inform you of the number of tokens placed in the collective account by your group, and of your gain in ecus for the period.
At any time you can access the history of previous periods by clicking on the history button. The history will appear for each past period, the number of tokens that you put in each of the two accounts, the total number of tokens put in the collective account by your group, your gain in ecus for the period, and your cumulative gain since the first period of that Part.
Part 2
This part is also composed of 10 periods. The composition of the groups is unchanged. Your group is therefore composed of the same members as in Part 1. As in the preceding part, at the beginning of each period, you will have an amount of 20 tokens that you must allocate between your individual account and the collective account.
Additional instructions
From now on, the tokens that you do not put in the collective account, and that remain therefore in your individual account, are subject to a 30 % deduction. Thus, 0.3 ecus are deducted for every token that remains in your individual account. This deduction is applied in each period. If for example, you put 12 tokens in your individual account, your gain from this account is
The functioning of the collective account is the same as in Part 1 of the experiment: each token placed in the collective account therefore earns 0.4 ecus for each member of the group (you included).
Your gain for the period is still equal to the sum of the gains of your individual account and the collective account.
Example
You put 6 tokens in the collective account and therefore 14 tokens in your individual account. Let us suppose that the three other members of your group put a total of 26 tokens in the collective account. In total, the collective account now comprises
Part 3
This part is also composed of 10 periods. The composition of the groups is unchanged. In the same way, at the beginning of each period, you have 20 tokens that you must allocate between your individual account and the collective account. The functioning of these two accounts is the same as in Part 1. Thus, each token placed in your individual account earns you 1 ecu.
Additional instructions
At the beginning of each period, every participant in this room will have a message displayed on his or her computer screen. The message is the same for everybody.
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©2016 by De Gruyter
Articles in the same Issue
- Frontmatter
- Litigation with a Variable Cost of Trial
- Ex ante versus Ex post Governance: A Behavioral Perspective
- Risk Aversion, the Hand Rule, and Comparison between Strict Liability and the Negligence Rule
- Takings and Tax Revenue: Fiscal Impacts of Eminent Domain
- When Should Governments Reveal Criminal Histories?
- Ideology and Strategy among Politicians: The Case of Judicial Independence
- Tax Return as a Political Statement
- What Makes Law to Change Behavior? An Experimental Study
Articles in the same Issue
- Frontmatter
- Litigation with a Variable Cost of Trial
- Ex ante versus Ex post Governance: A Behavioral Perspective
- Risk Aversion, the Hand Rule, and Comparison between Strict Liability and the Negligence Rule
- Takings and Tax Revenue: Fiscal Impacts of Eminent Domain
- When Should Governments Reveal Criminal Histories?
- Ideology and Strategy among Politicians: The Case of Judicial Independence
- Tax Return as a Political Statement
- What Makes Law to Change Behavior? An Experimental Study
