Abstract: Although sanctioning is a common feature of social life, researchers hold different expectations about how members respond when sanctioned by their peers. One school of thought suggests that individuals respond to sanctions by becoming more cooperative, or prosocial, towards the group. Another line of research shows that individuals have negative emotional reactions to being punished and become less cooperative. In this study, we offer an avenue for reconciling these seemingly-conflicting viewpoints in the context of voluntary associations, where cooperation is crucial. We build on theories of dependence and propose that individuals’ responses to sanctions shift over time as they become increasingly dependent on other members to achieve valued outcomes. We draw on unique data from microsavings groups in Colombia to develop and test this proposition, using qualitative data to flesh out the proposed mechanism and longitudinal, quantitative records to test the hypothesis. We find that individuals initially respond to being sanctioned by reducing their prosocial contributions, but that their responses become increasingly cooperative and prosocial over time. Taking social psychological concepts generated in laboratories and extending them to small groups in an economic development program, this study generates a fresh vision of sanctions as temporally- and relationally-dependent, while also revealing how processes of social control can shape inequality in voluntary associations.