This post is about a paper of mine with Carlo Perroni of Warwick University, The Logic of Costly Punishment Reversed. It has just been accepted in the Journal of Economic Behavior and Organization (ungated version at my website).
The germ for this paper came in 2006 at Northwestern University, in a chat with my game theory lecturer, Christoph Kuzmics. He mentioned to me that he was working on evolutionary game theory explanations for costly punishment.
The idea of costly punishment is that people are prepared to pay costs so as to punish bad behaviour or take revenge. For example, if a guy starts a bar fight because you spilled his beer, or someone lectures you for leaving litter, that might be costly punishment. Why is that important? Well, all societies need to maintain order – to prevent crime and ensure that people contribute to community goods. Modern societies have the machinery of the state – the policeman and the tax office – to do this. But throughout history, most people have lived in small societies without states; and there are many kinds of bad behaviour, like littering, that it would be too expensive or intrusive to control using the state’s coercive power. Instead, people in the group must punish bad behaviour, either verbally, financially or physically.