Humans are more complex than that. If they become aware that someone is applying such conditioning, they will defy it.

For the same reason corporal punishment doesn't work even on an average intelligence child. They quickly figure out that probability of getting punished again is not 100% and even if, that's just cost of doing business - sometimes it's worth it.

It's not complex at all. It's just violence. People are doing things you don't want them to do, so you do something to make them stop. Pretty standard.

If they can muster defiance, it's only because you weren't violent enough. If someone is defiant enough to play probability games with you, just punish them 100% of the time instead, even if they did nothing. He was probably doing it some other time where you didn't catch him, so it's warranted.

There's always someone willing to escalate things further. Things will escalate until someone discovers their limits and backs down. Consequences range from being quietly hated, to being ostracized, to being actively fucked with, to being beaten up, to being straight up killed.

Smart people don't fuck around and find out. They check their behavior so that they don't step on other people's toes for no reason. Violence very often comes with instructions on how to avoid it. Don't do this, and I won't do that. All they have to do is listen and follow the instructions.

The outcome where the obnoxious neighbor learns his lesson and stops his bad behavior is the good ending. The behavior stops, the situation de-escalates and peace is restored. If they keep up their defiance, things will only keep escalating further. Somebody could get hurt.