Voluntary provision of threshold public goods with continuous contributions: experimental evidence

Cadsby, Charles Bram; Maynes, Elizabeth

doi:10.1016/s0047-2727(98)00049-8

Cited by 226 publications

(168 citation statements)

References 17 publications

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“…We demonstrate that both factors contributed to the poor showing of stable coalitions with memberfinanced enforcement. Like other authors (Van de Kragt et al 1983;Dawes et al 1986;Suleimen and Rapoport 1992;Rapoport and Suleimen 1993;Cadsby and Maynes 1999) we find that increasing the participation threshold lowered the average provision of a public good because coalitions formed less frequently. Moreover, even though we structured the compliance incentives so that each member of a coalition had the financial motivation to comply, a significant number did not.…”

Section: Introductionsupporting

confidence: 85%

“…Kragt et al 1983;Dawes et al 1986;Isaac et al 1989;Rapoport and Eshed-Levy 1989;Erev and Rapoport 1990;Suleimen and Rapoport 1992;Rapoport and Suleimen 1993;Mysker et al 1996;Marks and Croson 1998;Marks and Croson 1999). A handful of other studies have found results that do not fall into the 50 -70% participation range, including Cadsby and Maynes (1999) who found that the public good is provided in only 26% of pooled trials and Bagnoli and Mckee (1991) who found that the public good was provided in 83% of all trials.…”

Section: Resultsmentioning

confidence: 99%

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The problem of maintaining compliance within stable coalitions: experimental evidence

McEvoy

Murphy

Spraggon

et al. 2010

Oxford Economic Papers

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Abstract:This study examines the performance of stable cooperative coalitions that form to provide a public good when coalition members have the opportunity to not comply with their commitments. A stable coalition is one in which no member wishes to leave and no non-member wishes to join. To counteract the incentive to violate their commitments, coalition members fund a third-party enforcer. This leads to the theoretical conclusion that stable coalitions are larger (and provide more of a public good) when their members must finance enforcement relative to when compliance is ensured without the need for costly enforcement. However, our experiments reveal that giving coalition members the opportunity to violate their commitments while requiring them to finance enforcement to maintain compliance reduces the overall provision of the public good. The decrease in the provision of the public good is attributed to an increase in the participation threshold for a theoretically stable coalition to form and to significant levels of noncompliance. When we abandon the strict stability conditions and require all subjects to join a coalition for it to form, the average provision of the public good increases significantly. Abstract: This study examines the performance of stable cooperative coalitions that form to provide a public good when coalition members have the opportunity to not comply with their commitments. A stable coalition is one in which no member wishes to leave and no non-member wishes to join. To counteract the incentive to violate their commitments, coalition members fund a third-party enforcer. This leads to the theoretical conclusion that stable coalitions are larger (and provide more of a public good) when their members must finance enforcement relative to when compliance is ensured without the need for costly enforcement. However, our experiments reveal that giving coalition members the opportunity to violate their commitments while requiring them to finance enforcement to maintain compliance reduces the overall provision of the public good. The decrease in the provision of the public good is attributed to an increase in the participation threshold for a theoretically stable coalition to form and to significant levels of noncompliance. When we abandon the strict stability conditions and require all subjects to join a coalition for it to form, the average provision of the public good increases significantly. JEL Codes: H41, C92

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Section: Introductionsupporting

confidence: 85%

Section: Resultsmentioning

confidence: 99%

The problem of maintaining compliance within stable coalitions: experimental evidence

McEvoy

Murphy

Spraggon

et al. 2010

Oxford Economic Papers

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“…Donors want you to spend what they give you and they want to see results of their philanthropy right away. Experienced givers are testing you with small gifts early in the relationship [2].…”

Section: Create a Vip Experience For Donorsmentioning

confidence: 99%

Fundraising in Ophthalmology

Fraunfelder¹

2017

J Eye Cataract Surg

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“…2 In the context of a threshold public goods game, for example, Cadsby and Maynes (1999) find lower levels of contribution when participants are provided binary rather than continuous action spaces. On the other hand, in the context of linear public goods games Gangadharan and Nikiforakis (2009) do not find differences in levels of contribution using binary (i.e., 0 or 10) versus integer (i.e., 0, 1, …, 10) action spaces.…”

Section: Introductionmentioning

confidence: 99%

The Problem with All-or-Nothing Trust Games: What Others Choose Not to Do Matters in Trust-Based Exchange

2016

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Many economic interactions are characterized by "all-or-nothing" action spaces that may limit the demonstrability of intended trust. We investigate whether restricting investment opportunities to all-or-nothing options affects the investment rate and propensity to reciprocate. We do this by manipulating the investor's action space in two versions of the trust game. In the all-or-nothing game the investor can invest either $10 (all) or $0 (nothing), while in the continuous game the investor can invest any amount between $10 and $0. In both games, the trustee receives the tripled investment and then can return any amount to the investor. Results indicate that investments are higher in the all-or-nothing game than in the continuous game. However, higher investments in the all-or-nothing game do not lead to higher returns. To the contrary, conditional on $10 investments, on average trustees return less in the all-or-nothing game. Although the all-ornothing action space results in greater wealth overall, it also appears to "backfire" for investors who do not benefit from the increased wealth. These results support the proposition that humans perceive intentions not only by evaluating what others do but also by evaluating what others choose not to do. JEL Classifications: C72, C91

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Voluntary provision of threshold public goods with continuous contributions: experimental evidence

Cited by 226 publications

References 17 publications

The problem of maintaining compliance within stable coalitions: experimental evidence

The problem of maintaining compliance within stable coalitions: experimental evidence

Fundraising in Ophthalmology

The Problem with All-or-Nothing Trust Games: What Others Choose Not to Do Matters in Trust-Based Exchange

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