Cooperation in Partnerships: The Role of Breakups and Reputation
AbstractWe investigate experimentally if endogenous partnership formation can improve efficiency in social dilemma situations. Subjects play multiple two-player public goods games, where they can break up with their current partner after every fourth game. Subjects without a partner provide rankings of the available other singles regarding their preferred subject to be matched with. A stable marriage mechanism determines the new matches. We vary the information subjects have when they express their preferences for their future matches and also if staying in a partnership leads to a cost or a bonus. We find that endogenous group formation can increase efficiency. Both the provision of contribution history at the time of re-matching and bonuses for staying in a partnership have positive effects. At least one of the two positive factors has to be present for an efficiency improvement. The presence of both leads to the best results.
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Bibliographic InfoPaper provided by University of Adelaide, School of Economics in its series School of Economics Working Papers with number 2011-22.
Length: 32 pages
Date of creation: Apr 2011
Date of revision:
Social Dilemma; Endogenous Group Formation; Public Goods;
Find related papers by JEL classification:
- D03 - Microeconomics - - General - - - Behavioral Economics; Underlying Principles
- D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
- H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-04-16 (All new papers)
- NEP-CBE-2011-04-16 (Cognitive & Behavioural Economics)
- NEP-EXP-2011-04-16 (Experimental Economics)
- NEP-GTH-2011-04-16 (Game Theory)
- NEP-SOC-2011-04-16 (Social Norms & Social Capital)
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- Kenju Kamei & Louis Putterman, 2013. "Play it Again: Partner Choice, Reputation Building and Learning in Restarting, Finitely-Repeated Dilemma Games," Working Papers 2013-8, Brown University, Department of Economics.
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