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Social pressure, uncertainty, and cooperation

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Author Info

  • Steffen Huck
  • Dorothea Kübler

Abstract

We analyse the role of uncertainty in a sequential game where players have to decide whether to contribute to a public project or not. A player's payoff may depend on his belief about the other player's action which allows us to model social pressure. Using the theory of psychological games, we show that the players' propensity to choose an individually costly action such as cooperation in a public project may increase if there is some uncertainty about who has cooperated before. A central agency, e.g. the government, can induce incomplete information by using a randomization policy, thus crowding in private contributions. Copyright Springer-Verlag Berlin Heidelberg 2000

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Bibliographic Info

Article provided by Springer in its journal Economics of Governance.

Volume (Year): 1 (2000)
Issue (Month): 3 (December)
Pages: 199-212

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Handle: RePEc:spr:ecogov:v:1:y:2000:i:3:p:199-212

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Web page: http://link.springer.de/link/service/journals/10101/index.htm

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Related research

Keywords: Key words: social pressure; psychological games; cooperation; JEL classification: C72; H41;

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Cited by:
  1. Pierpaolo Battigalli & Martin Dufwenberg, 2005. "Dynamic Psychological Games," Levine's Bibliography 784828000000000046, UCLA Department of Economics.

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