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I completed the Institute mission A House Divided in which there is a stand off in the biosciences laboratory which you can solve a variety of ways, I solved it with words and got everybody to stand down.

Afterwards, Newton Oberly asked me how I wanted to punish those involved and I chose to restrict their access to quarters and non-work areas. Newton seemed surprised by this. Later during the Powering Up mission I bumped into one of those involved and he was also very surprised that he was still alive.

What is an acceptable punishment for mutiny? If I choose to execute everybody involved what happens? Does this have any negative impact on how the rest of the Institute reacts to me?

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    Execute everyone involved, and everyone related to them by species, that should be adequate punishment.
    – Aequitas
    Nov 24 '15 at 22:25
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    Nuke them all! Nuking people is, by far, the best option there is, was and ever will exist in Fallout for any kind of problem. Nov 25 '15 at 13:11
  • Feed them to the forge!
    – fire.eagle
    Nov 25 '15 at 17:00
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I can answer part of that question. I chose to execute, because I run to kneejerk brutality in video games if I detect immorality...

The institute filler dialogue will become much more hostile, with unnamed NPCs openly criticizing your decision and rebuking you for your brutality. I'll update the answer if anything else concrete comes up. Surprisingly, Father was unphased when I talked to him right after.

Update: After playing through the game more, I have determined that if you do choose the brutality option, you can finish the game in favor of the Railroad as normal.

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Well I've done multiple playthroughs. The first time around, I decided to let it slide. Reason being that it was a difficult, transitional period, and responding to a knee-jerk incident with a knee-jerk reaction is the proverbial 'fighting fire with fire'. However, everyone in the Institute is surprised at your leniency.

On the flipside, if you have them executed, you'll lose decent workers, and whilst you may be intending to make an example of them, you'll also risk people wanting to 'jump ship' as it were (theoretically speaking of course; I don't think NPCs actually do escape in the game). Congratulations; you've become the 'Kim Jong-Un' of The Institute.

I think you did the right thing, issuing token punishments. I can't remember if there's a "banish them from the Institute" option - that's something that I'd logically choose, too.

Ultimately, whatever you do will inspire both positive and negative feedback from all kinds of people. Thinking about it, this applies to life as well as this game. :)

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I've only done one playthrough where I was allowed inside the institute (my first choice was to shoot Father in the first dialogue interaction) and I chose to exile the workers. Newton seemed surprised by this option but said that it was fair.

The NPCs in the institute are pretty split on this. Some say it was unjustified and that the scientists are now most likely dead while the others still think that I piss Father's excellence and saved the institute by keeping conflict to a minimum.

Exile doesn't affect gameplay in any way that I've noticed. Interestingly enough, I ran into Lawrence later in that playthrough. He was in his underwear supposedly dying of radiation and Max was nowhere to be found. Like a snotty little brat, he will blame you for his predicament and "ask" for some Radaway. I don't know if you could let him back into the Institute. I had Cait with me (for obvious reasons) so I chose the most violent dialogue options and placed a nuka grenade in his pocket after he blamed me for his new lifestyle. Insubordinate twat waffle to his very end.

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