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Date Published:Mar 23, 2009
Fostering cooperation is one of the main tasks of state building in the aftermath of civil wars, yet little is known about the effects of institutions of integration in increasing interethnic cooperation and facilitating peace. We conducted N-person public goods experiments with costly sanctions in the ethnically-divided city of Mostar in Bosnia- Herzegovina to examine whether and how the introduction of institutions of integration affects cooperation both within and across ethnic groups—in our case Catholic Bosnian Croats and Muslim Bosniacs. Our results indicate that even a limited policy intervention such as the creation of an integrated high school can offset the negative effects of ethnic heterogeneity, driving up peoples' willingness to contribute to public goods. We find that the introduction of institutions of integration is distinct from, and may be necessary for, the effectiveness of sanctions in driving up contributions. The results of this experiment suggest that the presence of integrative institutions can bring about cooperation even when increased heterogeneity diminishes it, thus introducing new ways of thinking about the role of institutions in post-conflict divided societies.