The Voluntary Provision of Public Goods under Varying Income Distributions

Chan, Kenneth S.; Mestelman, Stuart; Moir, Rob; Müller, Rudolf

doi:10.2307/136151

Cited by 157 publications

(130 citation statements)

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“…In a survey on repeated public goods games with complete information, Ledyard (1995) comes to the conclusion that economic heterogeneity among subjects generally lowers cooperation levels. Chan, Mestelman, Moir and Muller (1996) find that poor subjects contribute more to a public good than rich subjects. Buckley and Croson (2006) conduct a linear public good game with heterogenous endowments of the subjects.…”

Section: Related Literaturementioning

confidence: 77%

The dynamic interplay of inequality and trust—An experimental study

Greiner

Ockenfels

Werner

2012

Journal of Economic Behavior & Organization

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We study the interplay of inequality and trust in a dynamic growth game, in which trust increases efficiency and thus allows higher growth of the laboratory economy in the future. We find that trust is initially high in a treatment starting with equal endowments, but decreases over time. In a treatment with unequal endowments, trust is initially lower yet remains relatively stable. The reason is that, with unequal initial endowments, trust depends less on wealth comparisons. As a result, with respect to efficiency, the initially more unequal economy grows slower in the short run but faster in the long run, and the disparity of wealth distributions across economies mitigates over time.

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Section: Related Literaturementioning

confidence: 77%

The dynamic interplay of inequality and trust—An experimental study

Greiner

Ockenfels

Werner

2012

Journal of Economic Behavior & Organization

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“…4 1 They also show that an income redistribution from poorer individuals to wealthier individuals will lead to increased provision of a public good if the redistribution leads more of the poorer members of a community to choose to freeride completely on the contributions of their richer neighbors. Experimental tests of this hypothesis by Chan et al (1996) offer some support. On the other hand, Bergstrom, Blume and Varian predicted that a small redistribution of income -small enough so that the set of contributors to a public good is not changed-would not affect aggregate contributions.…”

Section: Introductionmentioning

confidence: 84%

Economic inequality and burden-sharing in the provision of local environmental quality

Cárdenas

Stranlund

Willis

2002

Ecological Economics

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A large, but inconclusive, literature addresses how economic heterogeneity affects the use of local resources and local environmental quality. One line of thought, which derives from Nash equilibrium provision of public goods, suggests that in contexts in which individual actions degrade local environmental quality, wealthier people in a community will tend to do more to protect environmental quality. In this paper we report on experiments performed in rural Colombia that were designed to explore the role that economic inequality plays in the 'provision' of local environmental quality. Subjects were asked to decide how much time to devote to collecting firewood from a local forest, which degrades local water quality, and how much to unrelated pursuits. Economic heterogeneity was introduced by varying the private returns to these alternative pursuits. Consistent with the Nash equilibrium prediction, we found that the players with more valuable alternative options put less pressure on local water quality. However, the subjects with less valuable alternative options showed significantly more restraint relative to their pure Nash strategies. Furthermore, they were willing to bear significantly greater opportunity costs to move their groups to outcomes that yielded higher average payoffs and better water quality than the Nash equilibrium outcome.

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“…Ostrom et al (1994), van Dijk et al (2002), and Cherry et al (2005 find that inequality leads to lower contributions, Chan et al (1996) and Buckley and Croson (2006) report a positive effect, and Chan et al (1999) and Sadrieh and Verbon (2006) no effect. With respect to heterogeneity in the marginal benefit from the public good, Fisher et al (1995) find that individuals with a high marginal benefit contribute more than those with a low marginal benefit.…”

Section: Introductionmentioning

confidence: 93%

Enforcement of contribution norms in public good games with heterogeneous populations

Reuben

Riedl

2013

Games and Economic Behavior

280

211

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in Enforcement of Contribution Norms in Public Good Games with Heterogeneous Populations AbstractEconomic and social interaction takes place between individuals with heterogeneous characteristics. We investigate experimentally the emergence and informal enforcement of different contribution norms to a public good in homogeneous and different heterogeneous groups. When punishment is not allowed all groups converge towards free-riding. With punishment, contributions increase and differ distinctly across groups and individuals with different induced characteristics. We show econometrically that these differences are not accidentally but enforced by punishment. The enforced contribution norms are related to fairness ideas of equity regarding the contributions but not regarding the earnings. Individuals with different characteristics tacitly agree on the norm to be enforced, even if this leads to large payoff differences. Our results also emphasize the role of details of the environment that may alter focal contribution norms in an important way.JEL Code: H41, C92, Z13.

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The Voluntary Provision of Public Goods under Varying Income Distributions

Cited by 157 publications

References 4 publications

The dynamic interplay of inequality and trust—An experimental study

The dynamic interplay of inequality and trust—An experimental study

Economic inequality and burden-sharing in the provision of local environmental quality

Enforcement of contribution norms in public good games with heterogeneous populations

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