0BThe Moral Costs of Nastiness1BReferences2BAppendix. Instructions for participants Discussion Paper No. 2009‐10Klaus Abbink and Benedikt Herrmann June 2009 The Moral Costs of Nastiness CeDEx Discussion Paper SeriesISSN 1749 ‐ 3293 The Centre for Decision Research and Experimental Economics was founded in 2000, and is based in the School of Economics at the University of Nottingham. The focus for the Centre is research into individual and strategic decision-making using a combination of theoretical and experimental methods. On the theory side, members of the Centre investigate individual choice under uncertainty, cooperative and non-cooperative game theory, as well as theories of psychology, bounded rationality and evolutionary game theory. Members of the Centre have applied experimental methods in the fields of Public Economics, Individual Choice under Risk and Uncertainty, Strategic Interaction, and the performance of auctions, Markets and other economic institutions. Much of the Centre's research involves collaborative projects with researchers from other departments in the UK and overseas. Please visit http://www.nottingham.ac.uk/economics/cedex/ for more information about the Centre or contact Karina Terry Centre for Decision Research and Experimental Economics School of Economics University of Nottingham University Park Nottingham NG7 2RD Tel: +44 (0) 115 95 15620 Fax: +44 (0) 115 95 14159 [email protected] The full list of CeDEx Discussion Papers is available at http://www.nottingham.ac.uk/economics/cedex/papers/index.html The Moral Costs of Nastiness by KLAUS ABBINK and BENEDIKT HERRMANN 1 We introduce two variants of the one-shot joy-of-destruction minigame (mini-JOD). Two players are endowed with the same amount of money. They simultaneously decide whether or not to reduce the payoff of the other player at an own cost. In one treatment there was a probability that Nature would destroy the opponent’s money anyway. We test whether this feature reduces the moral costs of being nasty, and find that destruction rates rise significantly, despite the absence of strategic reasons. Antisocial behaviour is ubiquitous in the real world. People suffer violence from perfect strangers or have their cars scratched and tyres punctured. Computer viruses are circulated solely to do harm. Yet behavioural economists have devoted almost all their attention to pro-sociality. There is an overwhelming body of literature on the cooperative, altruistic and fair-ness-minded homo reciprocans (a term coined by Fehr and Gächter (1998)), but experimental studies dealing with the darker side of human behaviour are few and far between.2 Zizzo and Oswald (2001) observe people foregoing own payoff for the reduction of someone else’s income, mainly to reduce disadvantageous inequality. Abbink and Sadrieh (2008) remove this motive from their joy-of-destruction game and still obtain destruction frequencies of up to 40%. Despotic behaviour has also been observed in public good games with punishment. Next to cooperators punishing free-riders, there is also a good deal of antisocial punishment, i.e. selfish individuals punishing contributors (Herrmann et al. (2008)). In this paper we study the role of moral costs and scruples in antisocial behaviour. We intro-duce the experimental joy-of-destruction minigame (mini-JOD, see Gächter et al. (2009)) with two treatments, open and hidden. In both treatments two players are endowed with 10 money units [MU] each, and both players simultaneously decide whether or not to destroy 5 MU of the other player’s endowment, at an own cost of 1 MU. In the hidden treatment, a die is rolled for each player. With 1/3 probability, the player loses 5 MU anyway, regardless of the other player’s decision, rendering.the other player’s decision to burn ineffective. A player who loses 5 MU through destruction is not told whether this was due to the opponent’s action, or to the roll of the die. Before we conducted the experiment, we hypothesised that this feature may reduce the moral costs of nastiness as the targeted subject cannot identify anymore the other player as the cause of destruction, while the destroyer can argue for herself that the money will quite possibly be destroyed anyway. Such reduction of the moral costs of being nasty therefore may increase burning rates.. The game was played one-shot, i.e. in both treat-ments strategic aspects, like fear of retaliation, did not play a role. In neither treatment could the target find out the destroyer’s identity, hence the moral cost effect involves the own con-science only, not the individual’s social reputation. The experiment was conducted by hand at universities in Dnipropetrovsk, Donetsk and Ter-nopil, all in Ukraine, with students from a wide range of disciplines. Participants were sepa-rated by a complete cardboard cover to ensure anonymity as burning decisions may be sensi- 1 Abbink: CREED, University of Amsterdam, [email protected],. Herrmann: School of Economics, The Univer-sity of Nottingham. [email protected] thank Inessa Penkova and Oleksiy Tarasenko for skillful research assistance and seminar participants in Nottingham for helpful comments. Financial support through the University of Nottingham is gratefully acknowledged. This version June 2009. 2 Earlier, some experimentalists explained behaviour in common games with negative motivations, like envy in ultimatum games (Kirchsteiger (1994)) or spite in public good games (Saijo and Nakamura (1995)). 1tive to the possibility of being observed. In an incentivised post-experimental questionnaire we asked participants about their expectation of their oppo-nent’s behaviour. 10.125.8010203040open (n=69) hidden (n=62)Percentage of decisions to burnFigure 1 shows the burning rates in the two treatments of our experiment. In the open treatment, about one in nine sub-jects (10.8%) exhibits nasty behaviour and destroys another person’s money at own costs. While this figure may seem low, the rate shoots up to more than a quarter (25.8%) in the hidden treatment. The difference is significant at p=0.012 (one-sided) according Fisher’s exact test. If there is a chance that the target loses the money anyway, and the source of the loss is not identifiable, the scru-ples subjects have to harm other sub-jects are reduced and they become con-siderablFigure