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Provision Of Step-Level Public Goods Under Uncertainty

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  • Ramzi Suleiman

Abstract

In a typical game examining voluntary contribution to the provision of step-level public goods, each member of a group of size n receives an endowment and then decides privately and anonymously how much of it to contribute for the provision of the good. The good is provided to all group members if and only if their total contribution is equal to, or larger than some threshold. While previous research assumed that group members have complete information about the threshold, the present article relaxes this assumption by treating the threshold as a random variable with a commonly known distribution. Three models, a subjective expected value model, a cooperative model and a strategic model are proposed to account for the individual's contribution decision. General solutions are then derived and their predictions for the case of a uniformly distributed threshold are evaluated.

Suggested Citation

  • Ramzi Suleiman, 1997. "Provision Of Step-Level Public Goods Under Uncertainty," Rationality and Society, , vol. 9(2), pages 163-187, May.
    • Handle: RePEc:sae:ratsoc:v:9:y:1997:i:2:p:163-187
    DOI: 10.1177/104346397009002002
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    2. Francisco José León, 2011. "Peer loyalty and quota restriction as social norms: A case study of their emergence," Rationality and Society, , vol. 23(1), pages 75-115, February.
    3. Pierre Courtois & Guillaume Haeringer, 2012. "Environmental cooperation: ratifying second-best agreements," Public Choice, Springer, vol. 151(3), pages 565-584, June.
    4. Lata Gangadharan & Veronika Nemes, 2009. "Experimental Analysis Of Risk And Uncertainty In Provisioning Private And Public Goods," Economic Inquiry, Western Economic Association International, vol. 47(1), pages 146-164, January.
    5. Koji Kotani & Kenta Tanaka & Shunsuke Managi, 2014. "Cooperative choice and its framing effect under threshold uncertainty in a provision point mechanism," Economics of Governance, Springer, vol. 15(4), pages 329-353, November.
    6. Dannenberg, Astrid & Löschel, Andreas & Paolacci, Gabriele & Reif, Christiane & Tavoni, Alessandro, 2011. "Coordination under threshold uncertainty in a public goods game," ZEW Discussion Papers 11-065, ZEW - Leibniz Centre for European Economic Research.
    7. Spencer, Michael A. & Swallow, Stephen K. & Shogren, Jason F. & List, John A., 2009. "Rebate rules in threshold public good provision," Journal of Public Economics, Elsevier, vol. 93(5-6), pages 798-806, June.
    8. Anauati, María Victoria & Feld, Brian & Galiani, Sebastian & Torrens, Gustavo, 2016. "Collective action: Experimental evidence," Games and Economic Behavior, Elsevier, vol. 99(C), pages 36-55.
    9. McBride, Michael, 2006. "Discrete public goods under threshold uncertainty," Journal of Public Economics, Elsevier, vol. 90(6-7), pages 1181-1199, August.
    10. Douadia Bougherara & Laurent Denant-Boèmont & David Masclet, 2007. "Creating vs. maintaining threshold public goods in conservation policies," Post-Print halshs-00175879, HAL.
    11. Ramzi Suleiman & David V. Budescu & Amnon Rapoport, 2001. "Provision of Step-Level Public Goods with Uncertain Provision Threshold and Continuous Contribution," Group Decision and Negotiation, Springer, vol. 10(3), pages 253-274, May.
    12. Boucher, Vincent & Bramoullé, Yann, 2010. "Providing global public goods under uncertainty," Journal of Public Economics, Elsevier, vol. 94(9-10), pages 591-603, October.
    13. Brouwer, Thijs & Potters, Jan, 2019. "Friends for (almost) a day: Studying breakaways in cycling races," Journal of Economic Psychology, Elsevier, vol. 75(PB).
    14. Au, Wing Tung & Chen, Xiao-Ping & Komorita, S. S., 1998. "A Probabilistic Model of Criticality in a Sequential Public Good Dilemma," Organizational Behavior and Human Decision Processes, Elsevier, vol. 75(3), pages 274-293, September.
    15. Astrid Dannenberg & Andreas Löschel & Gabriele Paolacci & Christiane Reif & Alessandro Tavoni, 2015. "On the Provision of Public Goods with Probabilistic and Ambiguous Thresholds," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 61(3), pages 365-383, July.

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