Social norms play an important role in individual decision making. We argue that two different expectations influence our choice to obey a norm: what we expect others to do (empirical expectations) and what we believe others think we ought to do (normative expectations). Little is known about the relative importance of these two types of expectation in individuals' decisions, an issue that is particularly important when normative and empirical expectations are in conflict (e.g., systemic corruption, high crime cities). In this paper, we report data from Dictator game experiments where we exogenously manipulate dictators' expectations in the direction of either selfishness or fairness. When normative and empirical expectations are in conflict, we find that empirical expectations about other dictators' choices significantly predict a dictator's own choice. However, dictators' expectations regarding what other dictators think ought to be done do not have a significant impact on their decisions after controlling for empirical expectations. Our findings about the crucial influence of empirical expectations are important for designing institutions or policies aimed at discouraging undesirable behavior.

Evolutionary theory reveals that punishment is effective in promoting cooperation and maintaining social norms. Although it is accepted that emotions are connected to punishment decisions, there remains substantial debate over why humans use costly punishment. Here we show experimentally that constraints on emotion expression can increase the use of costly punishment. We report data from ultimatum games, where a proposer offers a division of a sum of money and a responder decides whether to accept the split, or reject and leave both players with nothing. Compared with the treatment in which expressing emotions directly to proposers is prohibited, rejection of unfair offers is significantly less frequent when responders can convey their feelings to the proposer concurrently with their decisions. These data support the view that costly punishment might itself be used to express negative emotions and suggest that future studies will benefit by recognizing that human demand for emotion expression can have significant behavioral consequences in social environments, including families, courts, companies, and markets.cooperation ͉ ultimatum game ͉ sanction ͉ behavioral economics E motion is related to many aspects of social life, from physical survival to social relationships and reproduction (1, 2). With or without self-awareness, humans often display their feelings in different ways when aroused (3-5). However, in many naturally occurring social situations, individuals might believe that it is improper or impossible to reveal their feelings directly to, for example, a perceived antagonist. For instance, a sales clerk might find it improper to confront her customer (6). Because individuals often have a desire to express their emotions, the presence of constraints on expression can have important consequences for human behaviors (7,8). This research uses ultimatum games to investigate links between constraints on emotion expression (EE) and punishment decisions.The ultimatum game (9) is widely used to study costly punishment. In this game, one subject (the proposer) starts with, say, $20, and the other subject (the responder) begins with nothing. The proposer suggests a division of the $20 between them, and the responder decides whether to accept the proposed split. If accepted, then the money is split as proposed; if not, then both subjects earn nothing. Consequently, an income-maximizing responder should accept any positive offer, and an incomemaximizing proposer would offer the responder the smallest possible positive amount.In fact, decades of data from ultimatum games show that responders who are offered 20% or so of the total amount choose to reject about half the time (10), and rejection rates increase as responder shares become smaller. Reasons for rejections have been a source of much debate. Recently however, brain imaging data has been collected while responders make their decisions, and the findings suggest that emotions are tightly connected to rejections (11). (For more general research on the link betwee...

People can become less cooperative when threatened with sanctions, and previous research suggests both "intentions" and incentives underlie this effect. We report data from an experiment aimed at determining the relative importance of intentions and incentives in producing non-cooperative behavior. Participants play a one-shot investment experiment in pairs. Investors send an amount to trustees, request a return on this investment and, in some treatments, can threaten sanctions to enforce their requests. Decisions by trustees facing threats imposed (or not) by investors are compared to decisions by trustees facing threats imposed (or not) by nature. When not threatened, trustees typically decide to return a positive amount less than the investor requested. When threatened this decision becomes least common. If the request is large relative to the sanction then most trustees return nothing. If the request is small, trustees typically return the requested amount. These results do not vary with investors' intentions. JEL classification: C71; C91

Sanctions are used ubiquitously to enforce obedience to social norms. However, recent field studies and laboratory experiments have demonstrated that cooperation is sometimes reduced when incentives meant to promote prosocial decisions are added to the environment. Although various explanations for this effect have been suggested, the neural foundations of the effect have not been fully explored. Using a modified trust game, we found that trustees reciprocate relatively less when facing sanction threats, and that the presence of sanctions significantly reduces trustee's brain activities involved in social reward valuation [in the ventromedial prefrontal cortex (VMPFC), lateral orbitofrontal cortex, and amygdala] while it simultaneously increases brain activities in the parietal cortex, which has been implicated in rational decision making. Moreover, we found that neural activity in a trustee's VMPFC area predicts her future level of cooperation under both sanction and no-sanction conditions, and that this predictive activity can be dynamically modulated by the presence of a sanction threat.cooperation ͉ neuroimaging ͉ perception shift ͉ punishment ͉ social norms S anctions are ubiquitous in modern human societies (1). The purpose of sanctions is to enforce norm obedience beyond the level that humans might achieve in the absence of punishment (2-4). However several recent field studies and laboratory experiments have established that adding monetary sanctions to an environment can reduce cooperation (5-7). Substantial speculation has arisen surrounding the source of this counterintuitive effect, including the possibility that the presence of sanctions might change individuals' perceptions of the environment, thus crowding out internal motivations for cooperation (5-8). The imposition of sanctions also might be perceived as a signal of distrust (9-11) and might create a hostile atmosphere (12, 13), leading to decreased cooperation.Previous behavioral experiments have sought to distinguish these competing explanations. For example, a recent study (5) reported data from an experiment aimed at determining the relative importance of intentions and incentives in producing noncooperative behavior. Participants played a one-shot investment experiment in pairs. Investors sent a certain amount to trustees, requested a return on that investment, and, in some treatments, could threaten sanctions to enforce their requests. Decisions by trustees facing threats imposed (or not) by investors were compared with decisions by trustees facing threats imposed (or not) by nature. The main finding was that when not threatened, trustees typically decided to return a positive amount less than the investor requested, but when threatened, that decision was less common. This result is the same whether the sanction is imposed by a human investor or by nature, suggesting that the detrimental effect of sanctions on cooperation might not hinge specifically on trustees' perceptions of investor intentions.

Previous literature has demonstrated the important role that trust plays in developing and maintaining well-functioning societies. However, if we are to learn how to increase levels of trust in society, we must first understand why people choose to trust others. One potential answer to this is that people view trust as normative: there is a social norm for trusting that imposes punishment for noncompliance. To test this, we report data from a survey with salient rewards to elicit people’s attitudes regarding the punishment of distrusting behavior in a trust game. Our results show that people do not behave as though trust is a norm. Our participants expected that most people would not punish untrusting investors, regardless of whether the potential trustee was a stranger or a friend. In contrast, our participants behaved as though being trustworthy is a norm. Most participants believed that most people would punish someone who failed to reciprocate a stranger’s or a friend’s trust. We conclude that, while we were able to reproduce previous results establishing that there is a norm of reciprocity, we found no evidence for a corresponding norm of trust, even among friends.