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Obligations and cooperative behaviour in public good games

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  • Galbiati, Roberto
  • Vertova, Pietro

Abstract

Laws express rules of conduct ('obligations') enforced by the means of penalties and rewards ('incentives'). The role of incentives in shaping individual behaviour has been largely analysed in the traditional economic literature. On the contrary, very little is known about the specific role of obligations. In this paper we test whether or not obligations have any independent effect on cooperation in a public good game. The results show that, for given marginal incentives, different levels of minimum contribution required by obligation determine significantly different levels of average contributions. Moreover, obligations per se cannot sustain cooperation over time, even if they affect the rate of decline of average contributions. Finally, unexpected changes in the minimum contribution have asymmetric dynamic effects on the levels of cooperation: a reduction does not alter the descending trend of cooperation, whereas an increase induces a temporary re-start in average contributions.

Suggested Citation

  • Galbiati, Roberto & Vertova, Pietro, 2008. "Obligations and cooperative behaviour in public good games," Games and Economic Behavior, Elsevier, vol. 64(1), pages 146-170, September.
    • Handle: RePEc:eee:gamebe:v:64:y:2008:i:1:p:146-170
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    More about this item

    Keywords

    Cooperation Incentives Obligations Laws Public good games;

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • K40 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - General

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