Is a Fine Still a Price? Replication As Robustness

Abstract: Gneezy & Rustichini's (2000) study, "A Fine is a Price", tested the basic assumption in psychology and economics that “when negative consequences are imposed on a behaviour", they will reduce it. In their randomized field study of late arrival at Israeli daycares, the authors instead found that late behaviour increased in response to introducing a fine. Gneezy & Rustichini provided an intuitively powerful explanation: the fine operated like a "price" to transform the extra care into a commodity. It crowded out parents' prior internal social motivations and had a counterproductive effect on the target behaviour. The explanation was intuitively powerful; the paper has been cited more than 2000 times. Given the importance of the paper and its behavioural insight, we seek to both replicate the result and explore how robust it is to different methodological approaches. We translate the structure of the original field study to vignette-based experimental surveys with subjects recruited through Amazon's MTurk. The use of experimental surveys and MTurk is increasingly common in empirical legal studies, psychology and economics. Our approach allows us to directly reproduce key conditions from Gneezy and Rustichini's original field study. Experimental conditions and post-experiment questions help untangle the influence of alternative explanations for the original result, distinguishing contractual concerns from social influences. Our initial results do not replicate the original results in our survey setting. The introduction of fines causes a reduction in anticipated late behaviour. We do not see the shifts in concerns about the social / moral evaluations of the behaviour that Gneezy and Rustichini suggested. Our basic results are consistent with the standard narrative that fines tend to deter behaviour – as Gneezy and Rustichini anticipated in their original study.