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On sequential and simultaneous contributions under incomplete information

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  • Parimal Bag
  • Santanu Roy

Abstract

Under incomplete information about (independent) private valuations of a public good, we establish sufficient conditions under which, despite the incentive to free ride on future contributors, the expected total amount of voluntary contributions is higher when agents contribute sequentially (observing prior contributions) rather than simultaneously. We establish this in a conventional framework with quasi-linear utility where agents care only about the total provision of the public good (rather than individual contribution levels) and there is no non-convexity in provision of the public good. We allow for arbitrary number of agents and fairly general distribution of types.
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  • Parimal Bag & Santanu Roy, 2011. "On sequential and simultaneous contributions under incomplete information," International Journal of Game Theory, Springer;Game Theory Society, vol. 40(1), pages 119-145, February.
    • Handle: RePEc:spr:jogath:v:40:y:2011:i:1:p:119-145
    DOI: 10.1007/s00182-010-0230-1
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    3. Anwesha Banerjee & Nicolas Gravel, 2020. "Contribution to a public good under subjective uncertainty," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 22(3), pages 473-500, June.
    4. Miriam Sinn, 2013. "Sequential Group Lending: A Mechanism to Raise the Repayment Rate in Microfinance," Economica, London School of Economics and Political Science, vol. 80(318), pages 326-344, April.
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    6. Chowdhury Mohammad Sakib Anwar & Jorge Bruno & Sonali SenGupta, 2022. "A Group Public Goods Game with Position Uncertainty," Papers 2210.08328, arXiv.org.
    7. Russo, Giuseppe & Senatore, Luigi, 2012. "A note on contribution games with loss functions," Economics Letters, Elsevier, vol. 115(2), pages 211-214.
    8. Krasteva, Silvana & Saboury, Piruz, 2021. "Informative fundraising: The signaling value of seed money and matching gifts," Journal of Public Economics, Elsevier, vol. 203(C).
    9. Anwar, Sakib & Bruno, Jorge & SenGupta, Sonali, 2022. "A Group Public Goods Game with Position Uncertainty," QBS Working Paper Series 2022/07, Queen's University Belfast, Queen's Business School.
    10. Friedel Bolle & Philipp E. Otto, 2022. "Voting behavior under outside pressure: promoting true majorities with sequential voting?," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 58(4), pages 711-740, May.
    11. Giorgio Ferrari & Frank Riedel & Jan-Henrik Steg, 2013. "Continuous-Time Public Good Contribution under Uncertainty: A Stochastic Control Approach," Papers 1307.2849, arXiv.org, revised Oct 2015.
    12. Stefano Barbieri, 2023. "Complementarity and information in collective action," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 75(1), pages 167-206, January.
    13. Jack, B. Kelsey & Recalde, María P., 2015. "Leadership and the voluntary provision of public goods: Field evidence from Bolivia," Journal of Public Economics, Elsevier, vol. 122(C), pages 80-93.
    14. Murat Yilmaz, 2010. "Auctioning a Discrete Public Good under Incomplete Information," Working Papers 2010/14, Bogazici University, Department of Economics.
    15. Richárd Kicsiny, 2017. "Solution for a class of closed-loop leader-follower games with convexity conditions on the payoffs," Annals of Operations Research, Springer, vol. 253(1), pages 405-429, June.
    16. Altınok, Ahmet & Yılmaz, Murat, 2018. "Dynamic voluntary contribution to a public project under time inconsistency," Journal of Economic Behavior & Organization, Elsevier, vol. 145(C), pages 114-140.
    17. Chang Jen-Wen, 2020. "Should the Talk be Cheap in Contribution Games?," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 20(2), pages 1-16, June.
    18. Senatore, L, 2011. "Public Good Provision with Convex Costs," MPRA Paper 36984, University Library of Munich, Germany.
    19. Sung-Hoon Park & Chad E. Settle, 2023. "Asymmetric Reimbursement and Contingent Fees in Environmental Conflicts: Observable vs. Unobservable Contracts," Games, MDPI, vol. 14(4), pages 1-10, July.
    20. Anwesha Banerjee & Stefano Barbieri & Kai A. Konrad, 2022. "Climate Policy, Irreversibilities and Global Economic Shocks," Working Papers tax-mpg-rps-2022-11, Max Planck Institute for Tax Law and Public Finance.
    21. Sikdar, Shiva, 2015. "On efforts in teams with stereotypes," Economics Letters, Elsevier, vol. 137(C), pages 203-207.
    22. Ferrari, Giorgio & Riedel, Frank & Steg, Jan-Henrik, 2016. "Continuous-Time Public Good Contribution under Uncertainty," Center for Mathematical Economics Working Papers 485, Center for Mathematical Economics, Bielefeld University.

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    More about this item

    Keywords

    Fundraising; Sequential vs. simultaneous contributions; Public goods; Incomplete information; D73; H41; L44;
    All these keywords.

    JEL classification:

    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • L44 - Industrial Organization - - Antitrust Issues and Policies - - - Antitrust Policy and Public Enterprise, Nonprofit Institutions, and Professional Organizations

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