Voluntary contributions with risky and uncertain marginal returns: the importance of the minimal value
AbstractPrevious research indicates that risky and uncertain marginal returns from the public good significantly lower contributions. This paper presents experimental results illustrating that the effects of risk and uncertainty depend on the employed parameterization. Speci?cally, if the value of the marginal per capita return under the worst state of nature allows for some efficiency gains, the presence of risk and uncertainty about the public good's value is not detrimental to cooperation. This ?nding casts doubt on the hypothesis that risk and uncertainty, per se, weaken people's willingness to contribute.
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Bibliographic InfoPaper provided by Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics in its series Jena Economic Research Papers with number 2009-062.
Date of creation: 06 Aug 2009
Date of revision:
Public goods experiments; Voluntary contributions; Risk; Uncertainty;
Find related papers by JEL classification:
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
- C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
- D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
- H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-08-08 (All new papers)
- NEP-CBE-2009-08-08 (Cognitive & Behavioural Economics)
- NEP-EXP-2009-08-08 (Experimental Economics)
- NEP-GTH-2009-08-08 (Game Theory)
- NEP-PBE-2009-08-08 (Public Economics)
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