Can Sanctions Nudge Cooperation? Research for New Study Began at the Centre

The groups each consisted of 6 persons. One experimental condition tested a German (Bonn - Kiel) against a Russian (Moscow - Tomsk) group composition. In these National conditions, Germans demonstrated a significantly more cooperative behaviour than Russians. International conditions tested groups consisting of three Russian and three German participants. Here, according to the study, Germans kept their cooperation level. Russians adapted quickly to this cooperative behavior – but only when a mechanism of punishment ('sanctions') was present. The expectation and experience of collective punishment ('sanctions') led to improved cooperation. The authors stress that in another international setting without this element in the experimental design, no such adaptation was observed. Hennig-Schmidt explains how incentives for (monetary) contributions to the collective good are created and at the same time the potential personal loss in case of failure is made salient in the experimental design:
 

All members of the group are under the risk that if they do not succeed collectively they may lose personally. The instructions said clearly: if you do not succeed – to achieve the cooperation goal – 75% of what you gained, is at risk to be lost.

She further recalls how this experiment was designed to elucidate the possible role of pre-conceptions like national stereotypes.
 

In the ‘Open’ conditions, we told the participants - you're going to play with Germans resp. with Russians. But in another ‘Blind’ condition we only told them you're going to play with subjects from another location – and most of the participants revealed later that they imagined the other university to be in their own country. Although, generally speaking, there were no significant differences between Open and Blind conditions in terms of cooperation, the same pattern of differences between international and national treatments, and in the effect of introducing sanctions, were observed

This article proves again what the Käte Hamburger Kollegs were and are meant to be: a 'Denkfreiraum' for excellent basic research in the humanities at many German universities. Quantitative Research contributes a distinctive view and insight to the toolbox of a methodological pluralism as is promoted, for example, by current international practice research. Experimental economics shares with practice research an interest in observable behaviour, in practices and procedures. This research models behavior under controlled laboratory conditions. It can make you think of other experimental settings like moot courts. Negotiations, among participants with different cultural backgrounds, are another research field, in which experimental economics has also produced fruitful results. The new study, initiated by Grimalda and Hennig-Schmidt, adds to this research. 

The article's intentions and results were summarized by Gianluca Grimalda this way:
 

Climate change is a formidable global challenge. However, the prospects of global cooperation appear to be thwarted by the parochial character of human psychology. In our experimental study, groups of German and Russian participants interact in real time to avert the prospect of a severe loss to their monetary accounts, a situation mimicking the threat posed by climate change. Contrary to the pessimistic prediction of parochialism, we find international cooperation to be beneficial. Russians, who cooperate little in national interactions, quickly converge to Germans’ higher cooperation levels. Sanctions are important to achieve this result, supporting current developments in international policy.

Martin Wolf

Imposing sanctions on non-compliant parties to international agreements is advocated as a remedy for international cooperation failure. Nevertheless, sanctions are costly, and rational choice theory predicts their ineffectiveness in improving cooperation. We test sanctions effectiveness experimentally in international collective-risk social dilemmas simulating efforts to avoid catastrophic climate change. We involve individuals from countries where sanctions were shown to be effective (Germany) or ineffective (Russia) in increasing cooperation. Here, we show that, while this result still holds nationally, international interaction backed by sanctions is beneficial. Cooperation by low cooperator groups increases relative to national cooperation and converges to the levels of high cooperators. This result holds regardless of revealing other group members' nationality, suggesting that participants' specific attitudes or stereotypes over the other country were irrelevant. Groups interacting under sanctions contribute more to catastrophe prevention than what would maximize expected group payoffs. This behaviour signals a strong propensity for protection against collective risks.