Are dyads conditionally cooperative? Evidence from a public goods experiment

Date: 2016-10
By: Morone, Andrea
Temerario, Tiziana
We analysed dyads strategies in one-shot public goods game. By means of a laboratory experiment, using a variant of the strategy-method, we found that more than one third of the dyads are conditional cooperators, whereas 18% can be categorised as free riders.
Keywords: Voluntary contributions; Conditional cooperation; Free riding; Strategy-method; Experiments;
JEL: C91 C92 H41

The Impact of Microfinance on Pro-Social Behaviors: Experimental Evidence of Public Goods Contributions in Uganda

Date: 2016-06
By: Bryan McCannon (West Virginia University, Department of Economics)
Zachary Rodriguez (Saint Bonaventure University, School of Business)
We ask whether access to microfinance loans by the poor has a spillover effect on their pro†social behaviors. An experimental field study in southern, rural Uganda is conducted using free riding in public goods contributions as an assessment. We document higher levels of contributions by those who have previously received a microloan. This effect cannot be explained by changes in social norms, income effects, or sample selection bias. The results suggest that exposure to microfinance promotes social preferences.
Keywords: experiment, field study, free riding, microfinance, public goods, social norm, social preference, Uganda

Solving the second-order free rider problem in a public goods game: An experiment using a leader support system

By: Hiroki Ozono (Faculty of Law, Economics and Humanities, Kagoshima University)
Nobuhito Jin (School of Psychology Practices, College of Integrated Human and Social Welfare Studies, Shukutoku University)
Motoki Watabe (School of Business, MonashUniversity, Malaysia, Jalan Lagoon Selatan)
Kazumi Shimizu (School of Political Science and Economics, Waseda University)
To study the collective action problem, researchers have investigated public goods games (PGG), in which each member decides to contribute to a common pool that returns benefits to all members equally. Punishment of non-cooperators—free riders—can lead to high cooperation in PGG. However, the existence of second-order free riders, who do not pay punishment costs, reduces the effectiveness of punishment. We focus on a “leader support system,” in which one group leader can freely punish group followers using capital pooled through the support of group followers. In our experiment, participants were asked to engage in three stages: a PGG stage in which followers decided to cooperate for their group; a support stage in which followers decided whether to support the leader or not; and a punishment stage in which the leader could punish any follower. We found both higher cooperation and higher support for a leader achieved under linkage-type leaders—who punished both non-cooperators and non-supporters. In addition, linkage-type leaders themselves earned higher profits than other leader types because they withdrew more support. This means that a leader who effectively punishes followers could increase their own benefits and the second-order free rider problem would be solved.

Delegation and Public Pressure in a Threshold Public Goods Game: Theory and Experimental Evidence

Date: 2016-03
By: Doruk Iris (Sogang University)
Jungmin Lee (Sogang University and Institute for the Study of Labor (IZA))
Alessandro Tavoni (London School of Economics, Grantham Research Institute on Climate Change and Environment)
The provision of global public goods, such as climate change mitigation and managing fisheries to avoid overharvesting, requires the coordination of national contributions. The contributions are managed by elected governments who, in turn, are subject to public pressure on the matter. In an experimental setting, we randomly assign subjects into four teams, and ask them to elect a delegate by a secret vote. The elected delegates repeatedly play a one shot public goods game in which the aim is to avoid losses that can ensue if the sum of their contributions falls short of a threshold. Earnings are split evenly among the team members, including the delegate. We find that delegation causes a small reduction in the group contributions. Public pressure, in the form of teammates’ messages to their delegate, has a significant negative effect on contributions, even though the messages are designed to be payoff-inconsequential (i.e., cheap talk). The reason for the latter finding is that delegates tend to focus on the least ambitious suggestion. In other words, they focus on the lower of the two public good contributions preferred by their teammates. This finding is consistent with the prediction of our model, a modified version of regret theory.
Keywords: Delegation, Cooperation, Threshold Public Goods Game, Climate Experiment, Regret Theory
JEL: C72 C92 D81 H4 Q54

Cheating in the Lab Predicts Fraud in the Field: An Experiment in Public Transportations

==noted by yinung==
讀過一些經濟實驗學者主張, 在實驗中不能欺騙受試者的這種說法。然而, 虛者實、實則虛, 為了讓受試者的行為無異於真實世界, 有時卻得要「因地制宜」
Date: 2016
By: Zhixin Dai (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,F-69130 Ecully, France)
Fabio Galeotti (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,F-69130 Ecully, France)
Marie Claire Villeval (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,F-69130 Ecully, France)
We conduct an artefactual field experiment using a diversified sample of passengers of public transportations to study attitudes towards dishonesty. We find that the diversity of behavior in terms of dis/honesty in laboratory tasks and in the field correlate. Moreover, individuals who have just been fined in the field behave more honestly in the lab than the other fare-dodgers, except when context is introduced. Overall, we show that simple tests of dishonesty in the lab can predict moral firmness in life, although frauders who care about social image cheat less when behavior can be verified ex post by the experimenter.
Keywords: Dishonesty, fare-dodging, field experiment, external validity, public transportations
JEL: B41 C91 C93 K42

Instruction length and content: Effects on punishment behaviour in public goods games

Date: 2015-12-07
By: Abhijit Ramalingam (University of East Anglia)
Antonio J. Morales (Universidad de Malaga)
James M. Walker (Indiana University)
Instruction length and content have been shown to affect comprehension levels and decision times of experimental subjects in public goods games. However, to date, there is no evidence of a significant impact on behaviour. We investigate the effects of instruction length and content on comprehension and behaviour in a more complicated setting - a public goods game with punishment. We find that longer instructions, that include examples that highlight the positive externality associated with public goods contributions, increase the comprehension levels of subjects, significantly lowering the time taken to answer the pre-experiment quiz and make decisions. Importantly, the differences in instructions are also associated with significant differences in behaviour. On average, groups that receive shorter instructions fail to use punishment effectively to raise contribution levels while those that receive longer instructions sustain higher contribution levels over time. In the former case, groups target low contributors less frequently than appears necessary to induce greater cooperation.
Keywords: public goods, punishment, instruction length, decision times, contributions, punishment
JEL: C72 C91 C92 H41

Privacy, trust and social network formation

Date: 2015
By: Gaudeul, Alexia
Giannetti, Caterina
We study in the laboratory the impact of private information revelation on the selection of partners when forming individual networks. Our experiment combines a “network game" and a “public-good game". In the network game, individuals decide with whom to form a link with, while in the public-good game they decide whether or not to contribute. The variations in our treatments allow us to identify the effect of revealing one´s name on the probability of link formation. Our main result suggests that privacy mechanisms affect partner selection and the consequent structure of the network: when individuals reveal their real name, their individual networks are smaller but their profits are higher. This indicates that the privacy costs of revealing personal information are compensated by more productive links.
Keywords: privacy,social networks,public goods,trust
JEL: D12 D85

Public Goods in Endogenous Networks

Date: 2015-10-21
By: Markus Kinateder (​University of Navarra)
Luca Paolo Merlino (Universit e libre de Bruxelles)
In this paper we study a local public good game in an endogenous network with heterogeneous agents. We consider two specifications, in which different networks arise. When agents differ in the cost of acquiring the public good, active agents form hierarchical complete multipartite graphs; yet, better types need not have more neighbors. When agents have heterogeneous benefits from the public good, nested split graphs in which investment need not be monotonic in type emerge. In large societies, few agents are active and the network dampens inequality.
Keywords: public goods,
JEL: C72 D00 D85 H41

Games Played on Networks

==Notes by yinung==
原本獨立的 game 在 linked network 玩會如何呢?
本文介紹了網路位置 (network position) 觀念, 及其對均衡的影響 (Ballester, CalvÛ-Armengol & Zenou (2006) Örst establish the connection between equilibrium action and Bonacich centrality (Bonacich 1987),另見 Yves Zenou. (2015),   “Key players" (344 Kb) , In: Y. Bramoullé, B.W. Rogers and A. Galeotti (Eds.), Oxford Handbook on the Economics of Networks, Oxford: Oxford University Press, forthcoming. Vox column)
Date: 2015-03
By: Yann Bramoullé (AMSE – Aix-Marseille School of Economics – EHESS – École des hautes études en sciences sociales – Centre national de la recherche scientifique (CNRS) – Ecole Centrale Marseille (ECM) – AMU – Aix-Marseille Université)
Rachel Kranton (Duke University, Department of Economics – Duke University (Durham, USA))
This chapter studies games played on fixed networks. These games capture a wide variety of economic settings including local public goods, peer effects, and technology adoption. We establish a common analytical framework to study a wide game class. We unearth new connections between games in the literature and in particular between those with binary actions, like coordination and best-shot games, and those with continuous actions and linear best replies. We review and advance existing results by showing how they tie together within the common framework. We discuss the game-theoretic underpinnings of key notions including Bonacich centrality, maximal independent sets, and the lowest and largest eigenvalue. We study the interplay of individual heterogeneity and the network and we develop a new notion – interdependence – to analyze how a shock to one agent affects the action of another agent. We outline directions for future research.

Luring Others into Climate Action: Coalition Formation Games with Threshold and Spillover Effects

Date: 2015-03
By: Valentina Bosetti (Fondazione Eni Enrico Mattei, Milan (Italy) and Bocconi University, Milan (Italy))
Melanie Heugues (Fondazione Eni Enrico Mattei, Milan (Italy))
Alessandro Tavoni (Grantham Research Institute, London School of Economics, London (England))
We study the effect of leadership in an experimental threshold public ‘bad’ game, where we manipulate both the relative returns of two investments (the more productive of which causes a negative externality) and the extent to which the gains from leadership diffuse to the group. The game tradeoffs mimic those faced by countries choosing to what degree and when to transition from incumbent polluting technologies to cleaner alternatives, with the overall commitment dictating whether they manage to avert dangerous environmental thresholds. Leading countries, by agreeing on a shared effort, may be pivotal in triggering emission reductions in non-signatories countries. In addition, the leaders’ coalition might also work as innovation and technology adoption catalyzer, thus producing a public good (knowledge) that benefits all countries. In our game, players can choose to tie their hands to a cooperative strategy by signing up to a coalition of first movers. The game is setup such that as long as the leading group reaches a pivotal size, its early investment in the externality-free project may catalyze cooperation by non-signatories. We find that the likelihood of reaching the pivotal size is higher when the benefits of early cooperation are completely appropriated by the coalition members, less so when these benefits spillover to the non-signatories. On the other hand, spillovers have the potential to entice second movers into adopting the ‘clean’ technology.
Keywords: Climate Change, International Cooperation, R&D Spillovers, Threshold Public Goods Game, Coalition Formation Game, Climate Experiment
JEL: Q5 Q58