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Are People Conditionally Cooperative? Evidence from a Public Goods Experiment

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  • Urs Fischbacher
  • Simon Gaechter
  • Ernst Fehr

Abstract

We investigate to what extent contribution decisions to a public good depend on the contributions of others. We employ a novel experimental technique that allows us to elicit people's willingness to be conditionally cooperative, i.e., to contribute more to the public good the more the other beneficiaries contribute. We find that about a third of subjects' contribution schedules is characterized by complete free-riding. However, a majority of 50 percent of the subjects displays conditional cooperation. Our results can explain why in most repeated public goods experiments subjects initially cooperate while towards the final periods cooperation declines to very low levels.

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Paper provided by Institute for Empirical Research in Economics - University of Zurich in its series IEW - Working Papers with number 016.

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Handle: RePEc:zur:iewwpx:016

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Keywords: voluntary contributions; conditional cooperation; free riding; strategy-method; experiments;

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  1. Anderson, Simon P. & Goeree, Jacob K. & Holt, Charles A., 1998. "A theoretical analysis of altruism and decision error in public goods games," Journal of Public Economics, Elsevier, Elsevier, vol. 70(2), pages 297-323, November.
  2. Andreoni, James, 1995. "Cooperation in Public-Goods Experiments: Kindness or Confusion?," American Economic Review, American Economic Association, American Economic Association, vol. 85(4), pages 891-904, September.
  3. Claudia Keser & Frans A.A.M. van Winden, 2000. "Conditional Cooperation and Voluntary Contributions to Public Goods," Tinbergen Institute Discussion Papers 00-011/1, Tinbergen Institute.
  4. Brandts, Jordi & Schram, Arthur, 2001. "Cooperation and noise in public goods experiments: applying the contribution function approach," Journal of Public Economics, Elsevier, Elsevier, vol. 79(2), pages 399-427, February.
  5. Sugden, Robert, 1984. "Reciprocity: The Supply of Public Goods through Voluntary Contributions," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 94(376), pages 772-87, December.
  6. Sonnemans, Joep & Schram, Arthur & Offerman, Theo, 1999. "Strategic behavior in public good games: when partners drift apart," Economics Letters, Elsevier, Elsevier, vol. 62(1), pages 35-41, January.
  7. Palfrey, Thomas R & Prisbrey, Jeffrey E, 1997. "Anomalous Behavior in Public Goods Experiments: How Much and Why?," American Economic Review, American Economic Association, American Economic Association, vol. 87(5), pages 829-46, December.
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