Cooperation and punishment in changing natural groups

We are conducting a public goods game experiment on cooperation and punishment in changing groups. Subjects will be categorized by their ethnicity (i.e., Israeli Jews and Israeli/Palestinian Arabs). Each subject receives an endowment of 20 monetary units and can choose to keep these units in a private account that only benefits oneself or to contribute them to two types of public goods: a local public good that gives a return of 0.7 to members of one's own ethnicity and a global public good that gives a return of 0.5 to all members regardless of their ethnicity. There are four members per group. In the first part of the experiment, we let subjects play 10 rounds of the public goods game in their group in one of two conditions. This repeated interaction allows subjects to develop group norms on how much to contribute to each of the two public goods. In one condition, groups begin homogeneous in terms of ethnicity. In the other condition, groups begin heterogeneous in terms of ethnicity (i.e., 2 Arabs and 2 Jews). After the first 10 rounds of the public goods game, we replace 2 members per group with 2 new members from another group and start the second part of the experiment. In the condition where groups began homogenous, they now become heterogeneous (e.g., after the first 10 rounds of the game, in groups with 4 Arab members, 2 of the Arab members are replaced by 2 Jewish members). We refer to this condition as HOM-HET. In the condition where groups began heterogeneous, the replacement leads to homogenous groups (e.g., in a group with 2 Arab and 2 Jewish members, the 2 Jewish members are replaced by 2 Arab members). We refer to this condition as HET-HOM. The reshaped groups in both conditions then play another 10 rounds of the public goods game. In both conditions, following each round of the public goods game, subjects can pay a fee to punish other group members by reducing points from their income.