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Volunteering a Public Service: An Experimental Investigation

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  • M. Bilodeau
  • J. Childs
  • S. Mestelman

Abstract

In some public goods environments it may be advantageous for heterogeneous groups to be coordinated by a single individual. This “volunteer” will bear private costs for acting as the leader while enabling each member of the group to achieve maximum potential gains. This environment is modeled as a War of Attrition game in which everyone can wait for someone else to volunteer. Since these games generally have multiple Nash equilibria but a unique subgameperfect equilibrium, we tested experimentally the predictive power of the subgame-perfection criterion. Our data contradict that subjects saw the subgame-perfect strategy combination as the obvious way to play the game. An alternative behavioral hypothesis – that subjects were unable to predict accurately how their opponents would play and tried to maximize their expected payoff – is proposed. This hypothesis fits the observed data generally well.

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Bibliographic Info

Paper provided by McMaster University in its series Department of Economics Working Papers with number 2001-05.

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Length: 33 pages
Date of creation: May 2001
Date of revision:
Handle: RePEc:mcm:deptwp:2001-05

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  1. Bliss, Christopher & Nalebuff, Barry, 1984. "Dragon-slaying and ballroom dancing: The private supply of a public good," Journal of Public Economics, Elsevier, vol. 25(1-2), pages 1-12, November.
  2. J. Ledyard, 1997. "Public Goods: A Survey of Experimental Research," Levine's Working Paper Archive 509, David K. Levine.
  3. Hendricks, Kenneth & Weiss, Andrew & Wilson, Charles, 1987. "The War of Attrition in Continuous Time with Complete Information," Working Papers 87-03, C.V. Starr Center for Applied Economics, New York University.
  4. Marc Bilodeau & Al Slivinski, . "Toilet Cleaning and Department Chairing: Volunteering a Public service," Public Economics 9405001, EconWPA.
  5. Nagel, Rosemarie, 1995. "Unraveling in Guessing Games: An Experimental Study," American Economic Review, American Economic Association, vol. 85(5), pages 1313-26, December.
  6. Drew Fudenberg & Jean Tirole, 1991. "Game Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262061414, January.
  7. Bergstrom, Theodore & Blume, Lawrence & Varian, Hal, 1986. "On the private provision of public goods," Journal of Public Economics, Elsevier, vol. 29(1), pages 25-49, February.
  8. Richard H. Thaler, 2000. "From Homo Economicus to Homo Sapiens," Journal of Economic Perspectives, American Economic Association, vol. 14(1), pages 133-141, Winter.
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