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Pure redistribution and the provision of public goods

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  • Sausgruber, Rupert
  • Tyran, Jean-Robert

Abstract

We study pure redistribution as a device to increase cooperation and efficiency in the provision of public goods. Experimental subjects play a two-stage game. The first stage is the standard linear public goods game. In the second stage, subjects can redistribute payoffs among other subjects in their group. We find that cooperation and efficiency increases substantially with this redistribution scheme, and that the redistribution option is popular. Our results provide an intuitive explanation for why an imposed redistribution rule, as proposed by Falkinger (1996), is capable of sustaining cooperation in the provision of public goods.

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Bibliographic Info

Article provided by Elsevier in its journal Economics Letters.

Volume (Year): 95 (2007)
Issue (Month): 3 (June)
Pages: 334-338

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Handle: RePEc:eee:ecolet:v:95:y:2007:i:3:p:334-338

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  1. Ernst Fehr & Simon Gaechter, 1999. "Cooperation and Punishment in Public Goods Experiments," CESifo Working Paper Series 183, CESifo Group Munich.
  2. Martin Sefton & Robert Shupp & James M. Walker, 2006. "The Effect of Rewards and Sanctions in Provision of Public Goods," Caepr Working Papers 2006-005, Center for Applied Economics and Policy Research, Economics Department, Indiana University Bloomington, revised Aug 2006.
  3. Josef Falkinger, 2000. "A Simple Mechanism for the Efficient Provision of Public Goods: Experimental Evidence," American Economic Review, American Economic Association, vol. 90(1), pages 247-264, March.
  4. Falkinger, Josef, 1996. "Efficient private provision of public goods by rewarding deviations from average," Journal of Public Economics, Elsevier, vol. 62(3), pages 413-422, November.
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Cited by:
  1. Julian Rauchdobler & Rupert Sausgruber & Jean-Robert Tyran, 2009. "Voting on Thresholds for Public Goods: Experimental Evidence," CESifo Working Paper Series 2896, CESifo Group Munich.
  2. Reuben, Ernesto & Tyran, Jean-Robert, 2009. "Everyone is a Winner: Promoting Cooperation through All-Can-Win Intergroup Competition," IZA Discussion Papers 4112, Institute for the Study of Labor (IZA).
  3. Markussen, Thomas & Reuben, Ernesto & Tyran, Jean-Robert, 2012. "Competition, Cooperation, and Collective Choice," CEPR Discussion Papers 9099, C.E.P.R. Discussion Papers.
  4. Talbot Page & Louis Putterman & Bruno Garcia, 2008. "Getting Punnishment Right: Do Costly Monitoring or Redustributive Punishment Help?," Working Papers 2008-1, Brown University, Department of Economics.
  5. Alexander W. Cappelen & Ulrik H. Nielsen & Erik Ø. Sørensen & Bertil Tungodden & Jean-Robert Tyran, 2012. "Give and Take in Dictator Games," Discussion Papers 12-05, University of Copenhagen. Department of Economics.
  6. Page, Talbot & Putterman, Louis & Garcia, Bruno, 2013. "Voluntary contributions with redistribution: The effect of costly sanctions when one person's punishment is another's reward," Journal of Economic Behavior & Organization, Elsevier, vol. 95(C), pages 34-48.

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