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Free-Riding and the Provision of Public Goods in the Family: A Laboratory Experiment


  • H. Elizabeth Peters
  • A. Sinan Unur
  • Jeremy Clark
  • William D. Schulze


We examine the provision of family public goods using experimental economics methods. With sufficient altruism and shared resource arrangements, families can provide the efficient level of family public goods. Becker's Rotten Kid Theorem asserts that transfers from altruistic parents will induce children to maximize family income even if children are not altruistic toward other family members. Consistent with altruism, parents and children contributed more to a public good when in groups with family members than when in groups with strangers. In contrast to the predictions of the Rotten Kid Theorem, however, children's behavior fell short of maximizing family income. Copyright 2004 by the Economics Department Of The University Of Pennsylvania And Osaka University Institute Of Social And Economic Research Association.

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  • H. Elizabeth Peters & A. Sinan Unur & Jeremy Clark & William D. Schulze, 2004. "Free-Riding and the Provision of Public Goods in the Family: A Laboratory Experiment," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 45(1), pages 283-299, February.
  • Handle: RePEc:ier:iecrev:v:45:y:2004:i:1:p:283-299

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    References listed on IDEAS

    1. Rubinstein, Ariel, 1982. "Perfect Equilibrium in a Bargaining Model," Econometrica, Econometric Society, vol. 50(1), pages 97-109, January.
    2. Henrick Horn & Asher Wolinsky, 1988. "Bilateral Monopolies and Incentives for Merger," RAND Journal of Economics, The RAND Corporation, vol. 19(3), pages 408-419, Autumn.
    3. Dobson, Paul W., 1994. "Multifirm unions and the incentive to adopt pattern bargaining in oligopoly," European Economic Review, Elsevier, vol. 38(1), pages 87-100, January.
    4. Kathryn J. Ready, 1990. "Is Pattern Bargaining Dead?," ILR Review, Cornell University, ILR School, vol. 43(2), pages 272-279, January.
    5. Daniel Diermeier & Roger B. Myerson, 1994. "Bargaining," Discussion Papers 1089, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
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