Get access

Coordinating Resistance Through Communication and Repeated Interaction

Authors


  • We are grateful to the Australian Research Council (DP0665667), the US National Science Foundation (grant SES-0516761) and the Faculty of Business and Economics of Monash University for financial support. We also thank Nick Argyres, John Duffy, Steve Gjerstad, Wieland Müeller, Yew-Kwang Ng, Charles Noussair, Ted O'Donoghue, In-Uck Park, three anonymous referees, seminar audiences at the Australian National University, Bar-Ilan, George Mason, Harvard, Michigan, NYU, Penn State, Richmond, Tilburg, Washington University in St. Louis, the University of Hong Kong, conference participants at Monash University, University of Melbourne, the Economic Science Association, the Econometric Society World Congress and especially David Myatt (the editor) for valuable comments. Ishita Chaterjee, Sukanya Chaudhuri, Israel del Mundo, Ratbek Djumashev, Roman Sheremeta and Jingjing Zhang provided valuable research assistance. The experiment was programmed and conducted with the software z-Tree (Fischbacher, 2007). We alone are responsible for any errors.

Abstract

Successful deterrence of leader expropriation is important for economic development. This article studies experimentally how repeated interactions and communication can help deter leaders from extracting surplus from their subordinates. We show that repetition alone is far from sufficient in deterring leader expropriation. Communication between subordinates is critical for increasing coordinated resistance even when the information communicated is highly restrictive. Adding communication reduces expropriation significantly even in the presence of repetition.

Ancillary