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Rich man and Lazarus – Asymmetric Endowments in Public-Good Experiments

Author

Listed:
  • Claudia Keser
  • Andreas Markstädter
  • Martin Schmidt
  • Cornelius Schnitzler

Abstract

We compare voluntary contributions to a public good in a symmetric setting to those in a weakly and a strongly asymmetric setting, where the players have different, randomly allocated endowments. We observe that the group-contribution levels are not significantly different between the symmetric and the weakly asymmetric setting. In both situations, participants tend to contribute the same proportion of their respective endowment. In the strongly asymmetric situation, where one of the players has a higher endowment than the three other players together, we observe a significantly lower group contribution than in the other situations. The rich player in this situation does not contribute significantly more than the average contribution of the poor players and thus contributes a significantly lower proportion of the endowment. This player is not as greedy as the rich man in the parable but leaves not more than breadcrumbs to the poor players.

Suggested Citation

  • Claudia Keser & Andreas Markstädter & Martin Schmidt & Cornelius Schnitzler, 2013. "Rich man and Lazarus – Asymmetric Endowments in Public-Good Experiments," CIRANO Working Papers 2013s-32, CIRANO.
    • Handle: RePEc:cir:cirwor:2013s-32
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    File URL: https://cirano.qc.ca/files/publications/2013s-32.pdf
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    References listed on IDEAS

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    1. Andreoni, James, 1988. "Why free ride? : Strategies and learning in public goods experiments," Journal of Public Economics, Elsevier, vol. 37(3), pages 291-304, December.
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    3. Vaughn, Gerald F. & Breimyer, Harold F. & Paarlberg, Don & Lovell, Sabrina J. & Kuch, Peter J. & Otte, John & Gardner, Bruce L. & Randall, Alan & Cunfer, Barry M., 1999. "Letters," Choices: The Magazine of Food, Farm, and Resource Issues, Agricultural and Applied Economics Association, vol. 14(3), pages 1-3.
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    1. Kingsley, David C., 2016. "Endowment heterogeneity and peer punishment in a public good experiment: Cooperation and normative conflict," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 60(C), pages 49-61.
    2. Rod Falvey & Tom Lane & Shravan Luckraz, 2022. "On a mechanism that improves efficiency and reduces inequality in voluntary contribution games," Discussion Papers 2022-15, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.

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    Keywords

    Experimental economics; public goods; asymmetries;
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