We introduce refund bonuses into the provision point mechanism. If a total contribution is less than the provision point, each contributor receives not only his contribution refunded but also a refund bonus the size of which is proportional to the contribution made. However, because of competition for refund bonuses the provision point is reached in equilibrium. Furthermore, the mechanism can uniquely implement the public good project with Lindahl prices. The mechanism also has other applications.

The provision point mechanism as a method of funding threshold public goods is extended with refund bonuses. Each contributor not only has his contribution refunded in the case of insufficient contributions but also receives a refund bonus proportional to his proposed contribution. As long as the refund bonus pool does not exceed the net value of the public good, in equilibrium the public good is always provided and refund bonuses are never distributed. In this paper, we empirically investigate this extension of the provision point mechanism in a laboratory experiment by testing its properties on allocative and distributive efficiency, equilibrium coordination, and invariance to information distribution. Individuals respond to the incentives induced by refund bonuses as predicted, but systematic deviations exist that are consistent with quantal response equilibrium. Since this simple mechanism has considerable practical potential especially in crowdfunding, these promising initial results call for further experimental work.

We study donation-based crowdfunding for threshold public good provision. Our main focus is on an extension with refund bonuses aimed at resolving the problems of equilibrium coordination and free riding. In the case of insufficient contributions, contributors not only have their contributions refunded but they also receive refund bonuses proportional to their pledged contributions. Thus, refund bonuses encourage more contributions but ultimately enough is raised given sufficient preference for the public good and in equilibrium no bonuses need to be paid. We test the predicted effects of refund bonuses in an experiment using a laboratory-based crowdfunding platform that features many main aspects of real-life platforms. Our main empirical result is that refund bonuses substantially increase the rate of funding success when contributors can support multiple projects. Furthermore, our findings also demonstrate that refund bonuses lead to significant economic gains even after accounting for their costs.

We examine asymmetric information about migrant earnings and its implications for remittance behavior using a sample of Indian households with husbands working overseas in Qatar. On average, wives underreport their husbands' income and underreporting is more prevalent in households with higher earning migrants. The discrepancy in earning reports is strongly correlated with variation in remittances: greater underreporting by wives is associated with lower remittances. We develop an exchange model of remittances with asymmetric information and costly state verification. The optimal remittance contract prescribes a threshold for remittances that invites verification only if unmet. The model's predictions closely match our empirical findings.JEL classification: D13, D82, F22, F24 Article households in El Salvador if their families were unaware of it. 1 This incipient evidence indicates that informational asymmetries about migrants' economic conditions can be a significant factor of remittance behavior, which, even though recognized in the literature (see Docquier 2006, 1143), has hardly been studied. 2 This paper deals with informational asymmetry about migrant earnings and examines, theoretically and empirically, the impact of this asymmetry on remittance flows. Generally, the main obstacle for conducting an empirical analysis is the absence of data on informational asymmetries within split households, which surveys of migrant or household alone cannot possibly provide. We offer a new solution to this problem. We assess informational asymmetries about income earned abroad by collecting migrants' reports about their earnings and contrasting these reports with accounts of their earnings collected from the remittance recipients. To our knowledge, this is one of the first few studies using a matched household dataset that collects cross-reports on variables of interest. 3 We are able to offer new evidence of substantial asymmetry in information within split households. In our representative sample of South Indian migrant households, where husbands are migrant workers in Qatar and wives remain behind in Kerala, India, wives report on average only about 79 percent of their husbands' earnings, which we show is unrelated to any reporting bias. We find that underreporting is not uniform across households-it is more prevalent in households with higher earning migrants. In particular, we observe that the reported earnings ratio-the ratio of the wife's report of her husband's earnings to that of her husband's-decreases in migrant earnings. Importantly, we find that asymmetric information about the migrant's income is strongly correlated with variation in remittances: all else equal, the lower the reported earnings ratio, the smaller the annual remittance sent home.By design, existing remittance models, mainly based on the symmetric information assumption, are not able to account for any differences in cross-reports and, consequently, cannot explain the observed relationship between the reported earnings ratio and remittanc...

We examine asymmetric information about migrant earnings and its implications for remittance behavior using a sample of Indian households with husbands working overseas in Qatar. On average, wives underreport their husbands' income and underreporting is more prevalent in households with higher earning migrants. The discrepancy in earning reports is strongly correlated with variation in remittances: greater underreporting by wives is associated with lower remittances. We develop an exchange model of remittances with asymmetric information and costly state verification. The optimal remittance contract prescribes a threshold for remittances that invites verification only if unmet. The model's predictions closely match our empirical findings.