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Uncertainty and Resistance to Reform in Laboratory Participation Games

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  • Vai-Lam Mui
  • Timothy N. Cason

Abstract

This paper presents a participation game experiment to study the impact of uncertainty and costly political participation on the incidence of reform. Fernandez and Rodrik (1991) show that uncertainty about who will ultimately gain or lose as a result of a reform can prevent its adoption. We introduce intra-group conflict into this framework by incorporating costly political participation, which creates a natural incentive for free-riding on fellow group members’ efforts to influence policy outcomes. An agent, however, may still be willing to participate if her participation is likely to affect the policy outcome given the probabilities of participation by others. Our experimental findings show that uncertainty reduces the incidence of reform even with costly political participation, and that an increase in the cost of participation reduces the participation of all agents, regardless of whether they belong to the majority and minority. This second result cannot be reconciled with the standard mixed strategy Nash equilibrium, but is consistent with the quantal response equilibrium.

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Bibliographic Info

Paper provided by Econometric Society in its series Econometric Society 2004 Australasian Meetings with number 1.

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Date of creation: 11 Aug 2004
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Handle: RePEc:ecm:ausm04:1

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Keywords: Reform; Uncertainty; Experiment; Participation Game; Bounded Rationality; Quantal Response Equilibrium;

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References

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  1. Sanjay Jain & Sharun W. Mukand, 2003. "Redistributive Promises and the Adoption of Economic Reform," American Economic Review, American Economic Association, vol. 93(1), pages 256-264, March.
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Citations

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Cited by:
  1. Bhattacharya, Sourav & Duffy, John & Kim, Sun-Tak, 2014. "Compulsory versus voluntary voting: An experimental study," Games and Economic Behavior, Elsevier, vol. 84(C), pages 111-131.
  2. Marina Agranov & Jacob K. Goeree & Julian Romero & Leeat Yariv, 2012. "What makes voters turn out: the effects of polls and beliefs," ECON - Working Papers 067, Department of Economics - University of Zurich.
  3. Battaglini, Marco & Morton, Rebecca & Palfrey, Thomas R, 2006. "The Swing Voter's Curse in the Laboratory," CEPR Discussion Papers 5458, C.E.P.R. Discussion Papers.
  4. Fabian Paetzel & Rupert Sausgruber & Stefan Traub, 2014. "Social Preferences and Voting on Reform: An Experimental Study," Department of Economics Working Papers wuwp172, Vienna University of Economics, Department of Economics.
  5. Jingjing Zhang, 2012. "Communication in asymmetric group competition over public goods," ECON - Working Papers 069, Department of Economics - University of Zurich.
  6. Timothy N. Cason & Vai-Lam Mui, 2003. "Testing Political Economy Models of Reform in the Laboratory," American Economic Review, American Economic Association, vol. 93(2), pages 208-212, May.
  7. Esteban F. Klory & Eyal Winter, 2006. "On Public Opinion Polls and Voters' Turnout," Levine's Working Paper Archive 321307000000000451, David K. Levine.
  8. David K. Levine & Thomas R. Palfrey, 2006. "The Paradox of Voter Participation? A Laboratory Study," Levine's Bibliography 321307000000000188, UCLA Department of Economics.
  9. Sourav Bhattacharya & John Duffy & Sun-Tak Kim, 2011. "Compulsory and Voluntary Voting Mechanisms: An Experimental Study," Working Papers 456, University of Pittsburgh, Department of Economics, revised Mar 2013.
  10. Sheremeta, Roman, 2009. "Essays on Experimental Investigation of Lottery Contests," MPRA Paper 49888, University Library of Munich, Germany.
  11. Coate, Stephen & Conlin, Michael & Moro, Andrea, 2008. "The performance of pivotal-voter models in small-scale elections: Evidence from Texas liquor referenda," Journal of Public Economics, Elsevier, vol. 92(3-4), pages 582-596, April.
  12. David K Levine & Thomas R Palfrey, 2005. "The Paradox of Voter Participation: A Laboratory Study," Levine's Working Paper Archive 618897000000000968, David K. Levine.
  13. Jens Großer & Arthur Schram, 2007. "Public Opinion Polls, Voter Turnout, and Welfare: An Experimental Study," Labsi Experimental Economics Laboratory University of Siena 014, University of Siena.
  14. Jingjing Zhang, 2009. "Communication in Asymmetric Group Competition over Public Goods," Department of Economics Working Papers 2009-06, McMaster University.
  15. Hannes Andréasson & Niklas Elert & Nils Karlson, 2013. "Does Social Cohesion Really Promote Reforms?," WWWforEurope Working Papers series 33, WWWforEurope.
  16. Arthur J.H.C. Schram, 2002. "Experimental Public Choice," Tinbergen Institute Discussion Papers 02-106/1, Tinbergen Institute.
  17. Arthur J.H.C. Schram, 2002. "Experimental Public Choice," Tinbergen Institute Discussion Papers 02-106/1, Tinbergen Institute.

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