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Leadership and cooperation in public goods experiments

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Author Info
Werner Güth ()
M. Vittoria Levati ()
Matthias Sutter ()
Eline van der Heijden

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Abstract

Leadership is important for the well-functioning of organizations. We examine the effects of leadership on contributions in public goods experiments. Leadership by example is implemented by letting one group member contribute to the public good before followers do. Such leadership increases contributions in comparison to the standard voluntary contribution mechanism, especially so when it goes along with authority, which we implement by granting the leader ostracism power. Whether leadership is fixed or rotating among group members has no significant influence on contributions. Only a minority of groups succeeds in endogenously installing a leader, even though groups with leaders are much more efficient than groups without a leader.

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Publisher Info
Paper provided by Max Planck Institute of Economics, Strategic Interaction Group in its series Papers on Strategic Interaction with number 2004-29.

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Length: 33 pages
Date of creation: May 2004
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Handle: RePEc:esi:discus:2004-29

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. M. Vittoria Levati & Tibor Neugebauer, 2004. "An Application of the English Clock Market Mechanism to Public Goods Games," Experimental Economics, Springer, vol. 7(2), pages 153-169, 06. [Downloadable!]
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  2. Potters, Jan & Sefton, Martin & Vesterlund, Lise, 2005. "After you--endogenous sequencing in voluntary contribution games," Journal of Public Economics, Elsevier, vol. 89(8), pages 1399-1419, August. [Downloadable!] (restricted)
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  3. Foss, Nicolai J, 2001. "Leadership, Beliefs and Coordination: An Explorative Discussion," Industrial and Corporate Change, Oxford University Press, vol. 10(2), pages 357-88, June.
  4. Ernst Fehr & Simon Gachter, 2000. "Cooperation and Punishment in Public Goods Experiments," American Economic Review, American Economic Association, vol. 90(4), pages 980-994, September. [Downloadable!] (restricted)
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  5. Weimann, Joachim, 1994. "Individual behaviour in a free riding experiment," Journal of Public Economics, Elsevier, vol. 54(2), pages 185-200, June. [Downloadable!] (restricted)
  6. David Masclet & Charles Noussair & Steven Tucker & Marie-Claire Villeval, 2003. "Monetary and Nonmonetary Punishment in the Voluntary Contributions Mechanism," American Economic Review, American Economic Association, vol. 93(1), pages 366-380, March. [Downloadable!]
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  7. Martin Brown & Armin Falk & Ernst Fehr, 2004. "Relational Contracts and the Nature of Market Interactions," Econometrica, Econometric Society, vol. 72(3), pages 747-780, 05. [Downloadable!] (restricted)
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  8. Keser, Claudia & van Winden, Frans, 2000. " Conditional Cooperation and Voluntary Contributions to Public Goods," Scandinavian Journal of Economics, Blackwell Publishing, vol. 102(1), pages 23-39, March. [Downloadable!] (restricted)
  9. Ernst Fehr & Klaus M. Schmidt, . "A Theory of Fairness, Competition and Cooperation," IEW - Working Papers iewwp004, Institute for Empirical Research in Economics - IEW. [Downloadable!]
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  10. Gary E. Bolton & Axel Ockenfels, 2000. "ERC: A Theory of Equity, Reciprocity, and Competition," American Economic Review, American Economic Association, vol. 90(1), pages 166-193, March. [Downloadable!] (restricted)
  11. Fischbacher, Urs & Gachter, Simon & Fehr, Ernst, 2001. "Are people conditionally cooperative? Evidence from a public goods experiment," Economics Letters, Elsevier, vol. 71(3), pages 397-404, June. [Downloadable!] (restricted)
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  12. Moxnes, E. & Heijden, E. van der, 2000. "The effect of leadership in a public bad experiment," Discussion Paper 102, Tilburg University, Center for Economic Research. [Downloadable!]
  13. Kirchsteiger, Georg & Niederle, Muriel & Potters, Jan, 2005. "Endogenizing market institutions: An experimental approach," European Economic Review, Elsevier, vol. 49(7), pages 1827-1853, October. [Downloadable!] (restricted)
  14. Brandts, Jordi & Schram, Arthur, 2001. "Cooperation and noise in public goods experiments: applying the contribution function approach," Journal of Public Economics, Elsevier, vol. 79(2), pages 399-427, February. [Downloadable!] (restricted)
  15. Heijden, E. van der & Moxnes, E., 2003. "Leading by example? Investment decisions in a mixed sequential-simultaneous public bad experiment," Discussion Paper 38, Tilburg University, Center for Economic Research. [Downloadable!]
  16. Nicholas Bardsley, 2000. "Control Without Deception: Individual Behaviour in Free-Riding Experiments Revisited," Experimental Economics, Springer, vol. 3(3), pages 215-240, December. [Downloadable!] (restricted)
  17. Palfrey, Thomas R & Prisbrey, Jeffrey E, 1997. "Anomalous Behavior in Public Goods Experiments: How Much and Why?," American Economic Review, American Economic Association, vol. 87(5), pages 829-46, December. [Downloadable!] (restricted)
  18. James Andreoni & William T. harbaugh & Lise Vesterlund, 2002. "The Carrot or the Stick: Rewards, Punishments, and Cooperation," University of Oregon Economics Department Working Papers 2002-01, University of Oregon Economics Department, revised 20 Aug 2002. [Downloadable!]
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  19. Martin Sefton & Robert Shupp & James M. Walker, 2006. "The Effect of Rewards and Sanctions in Provision of Public Goods," Caepr Working Papers 2006-005, Center for Applied Economics and Policy Research, Economics Department, Indiana University Bloomington, revised Aug 2006. [Downloadable!]
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  20. Sugden, Robert, 1984. "Reciprocity: The Supply of Public Goods through Voluntary Contributions," Economic Journal, Royal Economic Society, vol. 94(376), pages 772-87, December. [Downloadable!] (restricted)
  21. Hermalin, Benjamin E, 1998. "Toward an Economic Theory of Leadership: Leading by Example," American Economic Review, American Economic Association, vol. 88(5), pages 1188-1206, December. [Downloadable!] (restricted)
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  22. Arce M, Daniel G, 2001. "Leadership and the Aggregation of International Collective Action," Oxford Economic Papers, Oxford University Press, vol. 53(1), pages 114-37, January.
  23. Hermalin, Benjamin E., 2007. "Leading for the long term," Journal of Economic Behavior & Organization, Elsevier, vol. 62(1), pages 1-19, January. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Torun Dewan & David P. Myatt, 2007. "The Qualities of Leadership: Direction, Communication, and Obfuscation," Economics Series Working Papers 311, University of Oxford, Department of Economics. [Downloadable!]
    Other versions:
  2. Alan S. Blinder & John Morgan, 2007. "Leadership in Groups: A Monetary Policy Experiment," NBER Working Papers 13391, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  3. Urs Fischbacher & Simon Gächter, 2006. "Heterogeneous Social Preferences and the Dynamics of Free Riding in Public Goods," IZA Discussion Papers 2011, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  4. Paul Muller, 2006. "Reputation, trust and the dynamics of leadership in communities of practice," Journal of Management and Governance, Springer, vol. 10(4), pages 381-400, November. [Downloadable!] (restricted)
  5. Simon Gaechter, 2006. "Conditional cooperation: Behavioral regularities from the lab and the field and their policy implications," Discussion Papers 2006-03, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham. [Downloadable!]
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