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Does the Endowment of Contributors Make a Difference in Threshold Public-Good Games?

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  • Federica Alberti

Abstract

We investigate experimentally whether the endowment of potential contributors changes outcomes in threshold public-good games. We find that the variance in contributions is significantly reduced for low and high levels of endowment in comparison with an intermediate level of endowment. This difference emerges with experience. Evidence on whether the level of endowment influences the success rate at providing public goods is more mixed. We provide, however, a measure of endowment size that correlates with success rate. Our interpretation suggests that people find it hardest to coordinate on the provision of threshold public goods when endowments are of intermediate size. By intermediate we mean that the endowment is small enough that people need to contribute relatively a lot to fund the good, but also large enough that no one person is critical in providing the good.

Suggested Citation

  • Federica Alberti, 2015. "Does the Endowment of Contributors Make a Difference in Threshold Public-Good Games?," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 71(2), pages 216-239, June.
    • Handle: RePEc:mhr:finarc:urn:sici:0015-2218(201506)71:2_216:dteocm_2.0.tx_2-6
    DOI: 10.1628/001522108X14180267843207
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    Cited by:

    1. Cartwright, Edward & Stepanova, Anna, 2015. "The consequences of a refund in threshold public good games," Economics Letters, Elsevier, vol. 134(C), pages 29-33.
    2. Grigoriadis, Theocharis, 2017. "Religion, administration & public goods: Experimental evidence from Russia," Economic Modelling, Elsevier, vol. 66(C), pages 42-60.
    3. Federica Alberti & Edward J. Cartwright, 2016. "Full agreement and the provision of threshold public goods," Public Choice, Springer, vol. 166(1), pages 205-233, January.
    4. Feige, Christian & Ehrhart, Karl-Martin, 2015. "Voting and transfer payments in a threshold public goods game," Working Paper Series in Economics 73, Karlsruhe Institute of Technology (KIT), Department of Economics and Management.
    5. Federica Alberti & Anna Cartwright & Edward Cartwright, 2021. "Predicting Efficiency in Threshold Public Good Games: A Learning Direction Theory Approach," Working Papers in Economics & Finance 2021-01, University of Portsmouth, Portsmouth Business School, Economics and Finance Subject Group.

    More about this item

    Keywords

    public good; threshold; endowment;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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