IDEAS home Printed from https://ideas.repec.org/a/kap/enreec/v67y2017i3d10.1007_s10640-016-9997-2.html
   My bibliography  Save this article

Successful Leadership in Global Public Good Provision: Incorporating Behavioural Approaches

Author

Listed:
  • Wolfgang Buchholz

    (University of Regensburg
    CESifo Munich)

  • Todd Sandler

    (University of Texas at Dallas)

Abstract

In the standard model of voluntary public good provision and other game theoretic models, climate-friendly leadership of a country is not successful: A unilateral increase of this country’s greenhouse gas abatement measures, i.e., contributions to the global public good of climate protection, will not lead to a positive reaction by the other countries but instead trigger a reduction of their abatement efforts and thus a crowding-out effect. In this paper it is shown how this undesired consequence need no longer occur when elements of behavioral economics are incorporated in the otherwise standard model of public good provision. In particular, strategic complementarities between the public good contribution of the leading country and those of the follower may result either if the follower has specific non-egoistic or other-regarding preferences or if the leader’s contribution positively affects the follower’s beliefs, i.e., his conjectural variations, about the leader’s behaviour.

Suggested Citation

  • Wolfgang Buchholz & Todd Sandler, 2017. "Successful Leadership in Global Public Good Provision: Incorporating Behavioural Approaches," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 67(3), pages 591-607, July.
    • Handle: RePEc:kap:enreec:v:67:y:2017:i:3:d:10.1007_s10640-016-9997-2
    DOI: 10.1007/s10640-016-9997-2
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10640-016-9997-2
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s10640-016-9997-2?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Guttman, Joel M, 1978. "Understanding Collective Action: Matching Behavior," American Economic Review, American Economic Association, vol. 68(2), pages 251-255, May.
    2. Hubert Kempf & Grégoire Rota Graziosi, 2010. "Leadership in Public Good Provision: A Timing Game Perspective," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 12(4), pages 763-787, August.
    3. Michael Finus & Alejandro Caparrós (ed.), 2015. "Game Theory and International Environmental Cooperation," Books, Edward Elgar Publishing, number 15345.
    4. Kotchen, Matthew J., 2007. "Equilibrium existence and uniqueness in impure public good models," Economics Letters, Elsevier, vol. 97(2), pages 91-96, November.
    5. Rachel T. A. Croson, 2007. "Theories Of Commitment, Altruism And Reciprocity: Evidence From Linear Public Goods Games," Economic Inquiry, Western Economic Association International, vol. 45(2), pages 199-216, April.
    6. Wolfgang Buchholz, 1993. "A Further Perspective on Neutrality in a Public Goods Economy with Conjectural Variations," Public Finance Review, , vol. 21(1), pages 115-118, January.
    7. Hermalin, Benjamin E, 1998. "Toward an Economic Theory of Leadership: Leading by Example," American Economic Review, American Economic Association, vol. 88(5), pages 1188-1206, December.
    8. Richard Cornes & Roger Hartley, 2007. "Aggregative Public Good Games," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 9(2), pages 201-219, April.
    9. Scafuri, Allen J., 1988. "On consistency of conjectures in the private provision of public goods," Journal of Public Economics, Elsevier, vol. 37(3), pages 395-398, December.
    10. Dufwenberg, Martin & Kirchsteiger, Georg, 2004. "A theory of sequential reciprocity," Games and Economic Behavior, Elsevier, vol. 47(2), pages 268-298, May.
    11. Heike Auerswald & Kai A. Konrad & Marcel Thum, 2018. "Adaptation, mitigation and risk-taking in climate policy," Journal of Economics, Springer, vol. 124(3), pages 269-287, July.
    12. Karen Pittel & Dirk Rübbelke, 2012. "Transitions in the negotiations on climate change: from prisoner’s dilemma to chicken and beyond," International Environmental Agreements: Politics, Law and Economics, Springer, vol. 12(1), pages 23-39, March.
    13. Ernst Fehr & Klaus M. Schmidt, 1999. "A Theory of Fairness, Competition, and Cooperation," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 114(3), pages 817-868.
    14. Axel Ockenfels & Gary E. Bolton, 2000. "ERC: A Theory of Equity, Reciprocity, and Competition," American Economic Review, American Economic Association, vol. 90(1), pages 166-193, March.
    15. André Rossi De Oliveira & João Ricardo Faria & Daniel G. Arce M., 2005. "Leading by Example and International Collective Action," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 7(1), pages 51-63, February.
    16. Acemoglu, Daron & Jensen, Martin Kaae, 2013. "Aggregate comparative statics," Games and Economic Behavior, Elsevier, vol. 81(C), pages 27-49.
    17. Urs Fischbacher & Simon Gachter, 2010. "Social Preferences, Beliefs, and the Dynamics of Free Riding in Public Goods Experiments," American Economic Review, American Economic Association, vol. 100(1), pages 541-556, March.
    18. Wolfgang Buchholz & Kai Konrad, 1994. "Global environmental problems and the strategic choice of technology," Journal of Economics, Springer, vol. 60(3), pages 299-321, October.
    19. Allenj. Scafuri, 1992. "Rational Conjectures Equilibria in the Private Provision of Public Goods," Public Finance Review, , vol. 20(2), pages 139-151, April.
    20. Ihori, Toshihiro, 1996. "International public goods and contribution productivity differentials," Journal of Public Economics, Elsevier, vol. 61(1), pages 139-154, July.
    21. Barrett, Scott, 2005. "The theory of international environmental agreements," Handbook of Environmental Economics, in: K. G. Mäler & J. R. Vincent (ed.), Handbook of Environmental Economics, edition 1, volume 3, chapter 28, pages 1457-1516, Elsevier.
    22. Gary Charness & Matthew Rabin, 2002. "Understanding Social Preferences with Simple Tests," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 117(3), pages 817-869.
    23. Benedick, Richard Elliot, 1999. "Contrasting approaches: the ozone layer, climate change, and resolving the Kyoto dilemma," Discussion Papers, Research Professorship Environmental Policy FS II 99-404, WZB Berlin Social Science Center.
    24. Cornes, Richard & Sandler, Todd, 1994. "The comparative static properties of the impure public good model," Journal of Public Economics, Elsevier, vol. 54(3), pages 403-421, July.
    25. El-Sayed, Abeer & Rubio, Santiago J., 2014. "Sharing R&D investments in cleaner technologies to mitigate climate change," Resource and Energy Economics, Elsevier, vol. 38(C), pages 168-180.
    26. Todd Sandler & John Posnett, 1991. "The Private Provision of Public Goods: a Perspective on Neutrality," Public Finance Review, , vol. 19(1), pages 22-42, January.
    27. Kai A. Konrad & Marcel Thum, 2014. "Climate Policy Negotiations with Incomplete Information," Economica, London School of Economics and Political Science, vol. 81(322), pages 244-256, April.
    28. Simon Gaechter & Elke Renner, 2014. "Leaders as Role Models for the Voluntary Provision of Public Goods," CESifo Working Paper Series 5049, CESifo.
    29. Sandler, Todd & Buchholtz, Wolfgang & Haslbeck, Christian, 1998. "When Does Partial Cooperation Pay?," Staff General Research Papers Archive 1215, Iowa State University, Department of Economics.
    30. Rabin, Matthew, 1993. "Incorporating Fairness into Game Theory and Economics," American Economic Review, American Economic Association, vol. 83(5), pages 1281-1302, December.
    31. Brandt, Urs Steiner, 2004. "Unilateral actions, the case of international environmental problems," Resource and Energy Economics, Elsevier, vol. 26(4), pages 373-391, December.
    32. Pittel, Karen & Rübbelke, Dirk T.G., 2008. "Climate policy and ancillary benefits: A survey and integration into the modelling of international negotiations on climate change," Ecological Economics, Elsevier, vol. 68(1-2), pages 210-220, December.
    33. Jun–ichi Itaya & Makoto Okamura, 2003. "Conjectural Variations and Voluntary Public Good Provision in a Repeated Game Setting," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 5(1), pages 51-66, January.
    34. DeCanio, Stephen J. & Fremstad, Anders, 2013. "Game theory and climate diplomacy," Ecological Economics, Elsevier, vol. 85(C), pages 177-187.
    35. Dasgupta, Dipankar & Itaya, Jun-ichi, 1992. "Comparative Statics for the Private Provision of Public Goods in a Conjectural Variations Model with Heterogeneous Agents," Public Finance = Finances publiques, , vol. 47(1), pages 17-31.
    36. Hoel, Michael, 1991. "Global environmental problems: The effects of unilateral actions taken by one country," Journal of Environmental Economics and Management, Elsevier, vol. 20(1), pages 55-70, January.
    37. Wolfgang Buchholz & Wolfgang Peters, 2005. "A Rawlsian Approach to International Cooperation," Kyklos, Wiley Blackwell, vol. 58(1), pages 25-44, February.
    38. K. G. Mäler & J. R. Vincent (ed.), 2005. "Handbook of Environmental Economics," Handbook of Environmental Economics, Elsevier, edition 1, volume 3, number 3.
    39. Cornes,Richard & Sandler,Todd, 1996. "The Theory of Externalities, Public Goods, and Club Goods," Cambridge Books, Cambridge University Press, number 9780521477185.
    40. Cornes, Richard & Sandler, Todd, 1985. "On the consistency of conjectures with public goods," Journal of Public Economics, Elsevier, vol. 27(1), pages 125-129, June.
    41. Bergstrom, Theodore & Blume, Lawrence & Varian, Hal, 1986. "On the private provision of public goods," Journal of Public Economics, Elsevier, vol. 29(1), pages 25-49, February.
    42. Buchholz, Wolfgang & Cornes, Richard & Peters, Wolfgang & Rübbelke, Dirk, 2015. "Pareto improvement through unilateral matching of public good contributions: The role of commitment," Economics Letters, Elsevier, vol. 132(C), pages 9-12.
    43. Andreoni, James, 1990. "Impure Altruism and Donations to Public Goods: A Theory of Warm-Glow Giving?," Economic Journal, Royal Economic Society, vol. 100(401), pages 464-477, June.
    44. Cornes, Richard & Sandler, Todd, 1984. "Easy Riders, Joint Production, and Public Goods," Economic Journal, Royal Economic Society, vol. 94(375), pages 580-598, September.
    45. Daniel J. Benjamin, 2015. "Distributional Preferences, Reciprocity-Like Behavior, and Efficiency in Bilateral Exchange," American Economic Journal: Microeconomics, American Economic Association, vol. 7(1), pages 70-98, February.
    46. Roemer, John E., 2015. "Kantian optimization: A microfoundation for cooperation," Journal of Public Economics, Elsevier, vol. 127(C), pages 45-57.
    47. Daniele Nosenzo & Martin Sefton, 2011. "Endogenous Move Structure and Voluntary Provision of Public Goods: Theory and Experiment," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 13(5), pages 721-754, October.
    48. Possajennikov, Alex, 2015. "Conjectural variations in aggregative games: An evolutionary perspective," Mathematical Social Sciences, Elsevier, vol. 77(C), pages 55-61.
    49. Sugden, Robert, 1985. "Consistent conjectures and voluntary contributions to public goods: why the conventional theory does not work," Journal of Public Economics, Elsevier, vol. 27(1), pages 117-124, June.
    50. Cornes, Richard & Sandler, Todd, 1984. "The theory of public goods: non-nash behaviour," Journal of Public Economics, Elsevier, vol. 23(3), pages 367-379, April.
    51. Cabral, Luis M. B., 1995. "Conjectural variations as a reduced form," Economics Letters, Elsevier, vol. 49(4), pages 397-402, October.
    52. Sinn, Hans-Werner, 2012. "The Green Paradox: A Supply-Side Approach to Global Warming," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262016680, December.
    53. Arce M, Daniel G, 2001. "Leadership and the Aggregation of International Collective Action," Oxford Economic Papers, Oxford University Press, vol. 53(1), pages 114-137, January.
    54. Lipnowski, Irwin & Maital, Shlomo, 1983. "Voluntary provision of a pure public good as the game of `chicken'," Journal of Public Economics, Elsevier, vol. 20(3), pages 381-386, April.
    55. Varian, Hal R., 1994. "Sequential contributions to public goods," Journal of Public Economics, Elsevier, vol. 53(2), pages 165-186, February.
    56. Stefano Barbieri, 2012. "Communication and Early Contributions," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 14(3), pages 391-421, June.
    57. John E. Roemer, 2010. "Kantian Equilibrium," Scandinavian Journal of Economics, Wiley Blackwell, vol. 112(1), pages 1-24, March.
    58. Nyborg, Karine, 2014. "Reciprocal Climate Negotiators: Balancing Anger against Even More Anger," Memorandum 17/2014, Oslo University, Department of Economics.
    59. William Nordhaus, 2015. "Climate Clubs: Overcoming Free-Riding in International Climate Policy," American Economic Review, American Economic Association, vol. 105(4), pages 1339-1370, April.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Takaaki Abe & Yukihiko Funaki & Taro Shinoda, 2021. "Invitation Games: An Experimental Approach to Coalition Formation," Games, MDPI, vol. 12(3), pages 1-20, August.
    2. Stefano Carattini & Simon Levin & Alessandro Tavoni, 2019. "Cooperation in the Climate Commons," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 13(2), pages 227-247.
    3. Todd Sandler, 2018. "Collective action and geoengineering," The Review of International Organizations, Springer, vol. 13(1), pages 105-125, March.
    4. Botao Qin & Thorsten Janus, 2019. "Social norms and the effect of unilateral actions on climate change," Economics Bulletin, AccessEcon, vol. 39(1), pages 372-379.
    5. Brandt, Urs Steiner & Svendsen, Gert Tinggaard, 2022. "Is the annual UNFCCC COP the only game in town?," Technological Forecasting and Social Change, Elsevier, vol. 183(C).
    6. Wolfgang Buchholz & Michael Eichenseer, 2019. "Advantageous leadership in public good provision: the case of an endogenous contribution technology," Journal of Economics, Springer, vol. 126(1), pages 1-17, January.
    7. Anja Brumme & Wolfgang Buchholz & Dirk Rübbelke, 2023. "The purity of impure public goods," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 25(3), pages 493-514, June.
    8. Torben K. Mideksa, 2021. "Leadership and Climate Policy," CESifo Working Paper Series 9054, CESifo.
    9. Nyborg, Karine, 2018. "Reciprocal climate negotiators," Journal of Environmental Economics and Management, Elsevier, vol. 92(C), pages 707-725.
    10. Nathan W. Chan, 2019. "Funding Global Environmental Public Goods Through Multilateral Financial Mechanisms," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 73(2), pages 515-531, June.
    11. Jo, Ara & Carattini, Stefano, 2021. "Trust and CO2 emissions: Cooperation on a global scale," Journal of Economic Behavior & Organization, Elsevier, vol. 190(C), pages 922-937.
    12. Marc Daube, 2019. "Altruism and Global Environmental Taxes," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 73(4), pages 1049-1072, August.
    13. Marco Vincenzi, 2023. "Mapping the empirical relationship between environmental performance and social preferences: Evidence from macro data," ECONOMICS AND POLICY OF ENERGY AND THE ENVIRONMENT, FrancoAngeli Editore, vol. 2023(1), pages 85-102.
    14. Raphael Boleslavsky & Bruce Carlin & Christopher Cotton, 2019. "Disincentive Effects of Evaluation," Working Paper 1410, Economics Department, Queen's University.
    15. Buchholz, Wolfgang & Peters, Wolfgang & Ufert, Aneta, 2018. "International environmental agreements on climate protection: A Binary choice model with heterogeneous agents," Journal of Economic Behavior & Organization, Elsevier, vol. 154(C), pages 191-205.
    16. Fues, Thomas, 2018. "Investing in the behavioural dimensions of transnational cooperation: a personal assessment of the Managing Global Governance (MGG) Programme," IDOS Discussion Papers 12/2018, German Institute of Development and Sustainability (IDOS).
    17. Martin Kesternich & Christiane Reif & Dirk Rübbelke, 2017. "Recent Trends in Behavioral Environmental Economics," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 67(3), pages 403-411, July.
    18. Luca Corazzini & Christopher Cotton & Tommaso Reggiani, 2020. "Delegation and coordination with multiple threshold public goods: experimental evidence," Experimental Economics, Springer;Economic Science Association, vol. 23(4), pages 1030-1068, December.
    19. Håkon Sælen, 2020. "Under What Conditions Will the Paris Process Produce a Cycle of Increasing Ambition Sufficient to Reach the 2°C Goal?," Global Environmental Politics, MIT Press, vol. 20(2), pages 83-104, May.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Buchholz Wolfgang & Heindl Peter, 2015. "Ökonomische Herausforderungen des Klimawandels," Perspektiven der Wirtschaftspolitik, De Gruyter, vol. 16(4), pages 324-350, December.
    2. Wolfgang Buchholz & Todd Sandler, 2016. "Olson’s exploitation hypothesis in a public good economy: a reconsideration," Public Choice, Springer, vol. 168(1), pages 103-114, July.
    3. Wolfgang Buchholz & Michael Eichenseer, 2019. "Advantageous leadership in public good provision: the case of an endogenous contribution technology," Journal of Economics, Springer, vol. 126(1), pages 1-17, January.
    4. Andreas Löschel & Dirk Rübbelke, 2014. "On the Voluntary Provision of International Public Goods," Economica, London School of Economics and Political Science, vol. 81(322), pages 195-204, April.
    5. Gregor Schwerhoff & Ulrike Kornek & Kai Lessmann & Michael Pahle, 2018. "Leadership In Climate Change Mitigation: Consequences And Incentives," Journal of Economic Surveys, Wiley Blackwell, vol. 32(2), pages 491-517, April.
    6. Krasteva, Silvana & Saboury, Piruz, 2021. "Informative fundraising: The signaling value of seed money and matching gifts," Journal of Public Economics, Elsevier, vol. 203(C).
    7. Roi Zultan & Eva-Maria Steiger, 2011. "See No Evil: Information Chains and Reciprocity in Teams," Working Papers 1108, Ben-Gurion University of the Negev, Department of Economics.
    8. Boosey, Luke A., 2017. "Conditional cooperation in network public goods experiments," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 69(C), pages 108-116.
    9. Gregor Schwerhoff, 2013. "Leadership and International Climate Cooperation," Working Papers 2013.97, Fondazione Eni Enrico Mattei.
    10. Kurt A. Ackermann & Ryan O. Murphy, 2019. "Explaining Cooperative Behavior in Public Goods Games: How Preferences and Beliefs Affect Contribution Levels," Games, MDPI, vol. 10(1), pages 1-34, March.
    11. Buchholz, Wolfgang & Cornes, Richard & Rübbelke, Dirk, 2011. "Interior matching equilibria in a public good economy: An aggregative game approach," Journal of Public Economics, Elsevier, vol. 95(7), pages 639-645.
    12. Torben K. Mideksa, 2021. "Leadership and Climate Policy," CESifo Working Paper Series 9054, CESifo.
    13. Peter Katuscak & Tomas Miklanek, 2018. "Do Fixed-Prize Lotteries Crowd Out Public Good Contributions Driven by Social Preferences?," CERGE-EI Working Papers wp617, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    14. Nathan W. Chan, 2019. "Funding Global Environmental Public Goods Through Multilateral Financial Mechanisms," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 73(2), pages 515-531, June.
    15. Anja Brumme & Wolfgang Buchholz & Dirk Rübbelke, 2023. "The purity of impure public goods," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 25(3), pages 493-514, June.
    16. Marie Claire Villeval, 2012. "Contribution au bien public et préférences sociales : Apports récents de l'économie comportementale," Post-Print halshs-00681348, HAL.
    17. Wolfgang Buchholz & Wolfgang Peters & Aneta Ufert, 2014. "Spielräume für uni- und multilateralen Klimaschutz," Discussion Paper Series RECAP15 15, RECAP15, European University Viadrina, Frankfurt (Oder).
    18. Thorsten Chmura & Christoph Engel & Markus Englerth, 2013. "Selfishness As a Potential Cause of Crime. A Prison Experiment," Discussion Paper Series of the Max Planck Institute for Research on Collective Goods 2013_05, Max Planck Institute for Research on Collective Goods.
    19. Deb, Rahul & Gazzale, Robert S. & Kotchen, Matthew J., 2014. "Testing motives for charitable giving: A revealed-preference methodology with experimental evidence," Journal of Public Economics, Elsevier, vol. 120(C), pages 181-192.
    20. Tóbiás, Áron, 2023. "Rational Altruism," Journal of Economic Behavior & Organization, Elsevier, vol. 207(C), pages 50-80.

    More about this item

    Keywords

    Climate protection; Voluntary public good provision; Other-regarding preferences; Conjectural variations;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • H87 - Public Economics - - Miscellaneous Issues - - - International Fiscal Issues; International Public Goods
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:enreec:v:67:y:2017:i:3:d:10.1007_s10640-016-9997-2. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.