American Economic Review
ISSN 0002-8282 (Print) | ISSN 1944-7981 (Online)
Ostracism and Forgiveness
American Economic Review
vol. 106,
no. 8, August 2016
(pp. 2329–48)
Abstract
Many communities rely upon ostracism to enforce cooperation: if an individual shirks in one relationship, her innocent neighbors share information about her guilt in order to shun her, while continuing to cooperate among themselves. However, a strategic victim may herself prefer to shirk, rather than report her victimization truthfully. If guilty players are to be permanently ostracized, then such deviations are so tempting that cooperation in any relationship is bounded by what the partners could obtain through bilateral enforcement. Ostracism can improve upon bilateral enforcement if tempered by forgiveness, through which guilty players are eventually readmitted to cooperative society.Citation
Ali, S. Nageeb, and David A. Miller. 2016. "Ostracism and Forgiveness." American Economic Review, 106 (8): 2329–48. DOI: 10.1257/aer.20130768Additional Materials
JEL Classification
- C73 Stochastic and Dynamic Games; Evolutionary Games; Repeated Games
- D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
- D85 Network Formation and Analysis: Theory
- O17 Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
- Z13 Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification