Reproduction Materials For: Cooperation with Strangers: Spillover of Community Norms

<p><strong>PI-Provided Abstract</strong>: Why do leaders of organizations cooperate with players whom they may never transact with again? Such transactions can involve the incentives to exploit the other party because these interactions are not recurrent or embedded in networks. Yet in a market economy, organizational actors learn to cooperate with strangers; otherwise they risk closure from new ideas and business opportunities outside of their local community. With a large random sample of CEOs of manufacturing firms in the Yangzi River Delta region of China, we measured social norms using vignettes that describe hypothetical situations illustrating the social mechanisms of norm enforcement in respondents’ local communities. Several years later, in a lab-in-the-field experiment, we asked the same participants to play a one-shot Prisoner’s Dilemma game with a complete stranger. Our findings suggest that belief in the reliability of robust norm enforcement is positively associated with a higher probability of cooperation with strangers. To our knowledge, this mixed method study is the first to explore the relationship between social norms and cooperation with strangers using a large sample of leaders of organizations outside the environment of the laboratory. Finally, to explore the generalizability of our behavioral findings, we experimentally manipulated norm vignettes and study the PD game in online experiments with managers in the Yangzi River Delta region.Our main data source comes from the second and third waves (conducted in 2009 and 2012) of the Yangzi Delta Survey of Entrepreneurs and Firms (Nee and Opper 2012), a decade-long study following a stratified random sample of 700 CEOs and their private companies located in seven cities in China’s Yangzi River Delta region: Hangzhou, Ningbo, and Wenzhou (Zhejiang Province); Nanjing, Changzhou, and Nantong (Jiangsu Province); and Shanghai. The recruitment of participants for the survey followed a two-stage procedure. The sample frames came from local private-firm registers provided by China’s Bureau of Industry and Commerce. We oversampled medium (100 to 300 employees) and large (more than 300 employees) industrial firms and limited the inclusion of small firms (10 to 100 employees) to no more than two-thirds of the sample. About 100 firms were drawn from each of the seven cities. In addition, the sampling frames were stratified by the industrial sector of the firm, ranging from labor-intensive (ordinary machinery, automobile and vehicle parts, textiles) to knowledge-intensive (pharmaceutical, and electronic and communication appliances) sectors (for a detailed discussion of survey methodology, sampling protocols and data collection, see Nee and Opper 2012: 47-72).</p>