False friends are worse than bitter enemies:

Abstract 

One of the most critical features of human society is the pervasiveness of cooperation in social and economic exchanges. Moreover, social scientists have found overwhelming evidence that such cooperative behavior is likely to be directed toward in-group members. We propose that the group-based nature of cooperation includes punishment behavior. Punishment behavior is used to maintain cooperation within systems of social exchange and, thus, is directed towards members of an exchange system. Because social exchanges often take place within groups, we predict that punishment behavior is used to maintain cooperation in the punisher's group. Specifically, punishment behavior is directed toward in-group members who are found to be noncooperators. To examine this, we conducted a gift-giving game experiment with third-party punishment. The results of the experiment (N=90) support the following hypothesis: Participants who are cooperative in a gift-giving game punish noncooperative in-group members more severely than they punish noncooperative out-group members.

Keywords: Social exchange, Third-party punishment, Gift-giving game, Group-based cooperation, Second-order cooperation