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Matching Contributions and the Voluntary Provision of a Pure Public Good: Experimental Evidence

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Author Info

  • Ronald J. Baker II

    ()
    (Millersville University of Pennsylvania)

  • James M. Walker

    ()
    (Indiana University Bloomington)

  • Arlington W. Williams

    ()
    (Indiana University Bloomington)

Abstract

Laboratory experiments are used to study the voluntary provision of a pure public good in the presence of an anonymous external donor. The external funds are used in two different settings, lump-sum matching and one-to-one matching, to examine how allocations to the public good are affected. The experimental results reveal that allocations to the public good under lumpsum matching are significantly higher, and have significantly lower within-group dispersion, relative to one-to-one matching and a baseline setting without external matching funds.

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Bibliographic Info

Paper provided by Center for Applied Economics and Policy Research, Economics Department, Indiana University Bloomington in its series Caepr Working Papers with number 2006-007.

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Length: 35 pages
Date of creation: Aug 2006
Date of revision: Dec 2007
Handle: RePEc:inu:caeprp:2006007

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Keywords: public goods; free riding; laboratory experiments;

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References

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  1. Isaac, R. Mark & Walker, James M. & Williams, Arlington W., 1994. "Group size and the voluntary provision of public goods : Experimental evidence utilizing large groups," Journal of Public Economics, Elsevier, vol. 54(1), pages 1-36, May.
  2. Douglas D. Davis, 2006. "Rebate subsidies, matching subsidies and isolation effects," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 1, pages 13-22, July.
  3. Dean Karlan & John A. List, 2007. "Does Price Matter in Charitable Giving? Evidence from a Large-Scale Natural Field Experiment," American Economic Review, American Economic Association, vol. 97(5), pages 1774-1793, December.
  4. repec:feb:artefa:0090 is not listed on IDEAS
  5. Craig Landry & Andreas Lange & John A. List & Michael K. Price & Nicholas G. Rupp, 2005. "Toward an Understanding of the Economics of Charity: Evidence from a Field Experiment," NBER Working Papers 11611, National Bureau of Economic Research, Inc.
  6. John A. List & David Lucking-Reiley, 2000. "The Effects of Seed Money and Refunds on Charitable Giving: Experimental Evidence from a University Capital Campaign," Vanderbilt University Department of Economics Working Papers 0008, Vanderbilt University Department of Economics.
  7. Potters, J.J.M. & Sefton, M. & Vesterlund, L., 2001. "Why Announce Leadership Contributions? An Experimental Study of the Signaling and Reciprocity Hypotheses," Discussion Paper 2001-100, Tilburg University, Center for Economic Research.
  8. James Andreoni, 2006. "Leadership Giving in Charitable Fund-Raising," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 8(1), pages 1-22, 01.
  9. Eckel, Catherine C. & Grossman, Philip J., 2003. "Rebate versus matching: does how we subsidize charitable contributions matter?," Journal of Public Economics, Elsevier, vol. 87(3-4), pages 681-701, March.
  10. Jan Potters & Martin Sefton & Lise Vesterlund, 2007. "Leading-by-example and signaling in voluntary contribution games: an experimental study," Economic Theory, Springer, vol. 33(1), pages 169-182, October.
  11. Marks, Melanie & Croson, Rachel, 1998. "Alternative rebate rules in the provision of a threshold public good: An experimental investigation," Journal of Public Economics, Elsevier, vol. 67(2), pages 195-220, February.
  12. List, John A. & Rondeau, Daniel, 2003. "The impact of challenge gifts on charitable giving: an experimental investigation," Economics Letters, Elsevier, vol. 79(2), pages 153-159, May.
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Citations

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Cited by:
  1. Alexander Smith, 2013. "Estimating the causal effect of beliefs on contributions in repeated public good games," Experimental Economics, Springer, vol. 16(3), pages 414-425, September.
  2. Ronald J. Baker II & James M. Walker & Ioana Schiopu, 2010. "External Matching Funds and the Provision of Public Goods: An Experimental Study," Caepr Working Papers 2010-003, Center for Applied Economics and Policy Research, Economics Department, Indiana University Bloomington.
  3. Vossler, Christian A., 2009. "Analyzing repeated-game economics experiments: robust standard errors for panel data with serial correlation," MPRA Paper 38862, University Library of Munich, Germany.
  4. Baker, Ronald J. & Walker, James M. & Williams, Arlington W., 2011. "An exploration of the robustness of alternative laboratory methodologies: Matching funds and the provision of public goods," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 40(6), pages 763-774.
  5. Carlsson, Fredrik & Johansson-Stenman, Olof & Pham Khanh, Nam, 2011. "Funding a New Bridge in Rural Vietnam: A field experiment on conditional cooperation and default contributions," Working Papers in Economics 503, University of Gothenburg, Department of Economics.

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