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An Application of the English Clock Market Mechanism to Public Goods Games


  • Maria Vittoria Levati


  • Tibor Neugebauer



We conducted a laboratory study with a public goods game in which contributions are not submitted all at once but incrementally as coordinated in real time by a clock. Individuals press a button as soon as the clock equals their willingness to contribute. This public goods institution exploits the idea that people are conditionally cooperative (i.e., they match at least the minimum contribution of the others) rather than opportunistic in order to implement the Pareto-optimal outcome. By providing information about the point at which subjects stopped further contributions we found that the decision of a subject to stop contributing induced an immediate reaction of the other group members. As a consequence, the individual contributions were closely related to each other and a fairer income distribution was achieved than in the standard case in which only aggregated information was supplied after each period.

Suggested Citation

  • Maria Vittoria Levati & Tibor Neugebauer, 2001. "An Application of the English Clock Market Mechanism to Public Goods Games," Papers on Strategic Interaction 2001-04, Max Planck Institute of Economics, Strategic Interaction Group.
  • Handle: RePEc:esi:discus:2001-04 Note: The authors would like to thank seminar participants at Amsterdam, Berlin, Lisbon, Paris, Turin, York and especially Werner Güth, John Bone, Rachel Croson and Frans van Winden for valuable comments. Financial support from the EU-TMR Research Network ENDEAR (FMRX-CT98-0238) is gratefully acknowledged.

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    References listed on IDEAS

    1. Ernst Fehr & Simon Gächter, 2000. "Fairness and Retaliation: The Economics of Reciprocity," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 159-181, Summer.
    2. Rachel T. A. Croson, 2007. "Theories Of Commitment, Altruism And Reciprocity: Evidence From Linear Public Goods Games," Economic Inquiry, Western Economic Association International, vol. 45(2), pages 199-216, April.
    3. Fischbacher, Urs & Gachter, Simon & Fehr, Ernst, 2001. "Are people conditionally cooperative? Evidence from a public goods experiment," Economics Letters, Elsevier, vol. 71(3), pages 397-404, June.
    4. Keser, Claudia & van Winden, Frans, 2000. " Conditional Cooperation and Voluntary Contributions to Public Goods," Scandinavian Journal of Economics, Wiley Blackwell, vol. 102(1), pages 23-39, March.
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    6. Andreoni, James, 1995. "Cooperation in Public-Goods Experiments: Kindness or Confusion?," American Economic Review, American Economic Association, vol. 85(4), pages 891-904, September.
    7. Selten, Reinhard & Joachim Buchta, 1994. "Experimental Sealed Bid First Price Auctions with Directly Observed Bid Functions," Discussion Paper Serie B 270, University of Bonn, Germany.
    8. Palfrey, Thomas R & Prisbrey, Jeffrey E, 1997. "Anomalous Behavior in Public Goods Experiments: How Much and Why?," American Economic Review, American Economic Association, vol. 87(5), pages 829-846, December.
    9. Sonnemans, Joep & Schram, Arthur & Offerman, Theo, 1999. "Strategic behavior in public good games: when partners drift apart," Economics Letters, Elsevier, vol. 62(1), pages 35-41, January.
    10. Brandts, Jordi & Schram, Arthur, 2001. "Cooperation and noise in public goods experiments: applying the contribution function approach," Journal of Public Economics, Elsevier, vol. 79(2), pages 399-427, February.
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    Cited by:

    1. Susana Cabrera & Enrique Fatás & Juan Lacomba & Tibor Neugebauer, 2013. "Splitting leagues: promotion and demotion in contribution-based regrouping experiments," Experimental Economics, Springer;Economic Science Association, vol. 16(3), pages 426-441, September.
    2. Koukoumelis, Anastasios & Levati, M. Vittoria & Weisser, Johannes, 2012. "Leading by words: A voluntary contribution experiment with one-way communication," Journal of Economic Behavior & Organization, Elsevier, vol. 81(2), pages 379-390.
    3. Werner Güth & Maria Vittoria Levati & Andreas Stiehler, "undated". "Privately Contributing to Public Goods over Time - An Experimental Study -," Papers on Strategic Interaction 2002-01, Max Planck Institute of Economics, Strategic Interaction Group.
    4. Pavel Diev & Walid Hichri, 2008. "Dynamic voluntary contributions to a discrete public good: Experimental evidence," Economics Bulletin, AccessEcon, vol. 3(23), pages 1-11.
    5. Max Albert & Werner Güth & Erich Kirchler & Boris Maciejovsky, 2007. "Are we nice(r) to nice(r) people?—An experimental analysis," Experimental Economics, Springer;Economic Science Association, vol. 10(1), pages 53-69, March.
    6. Alexis Belianin & Marco Novarese, 2005. "Trust, communication and equlibrium behaviour in public goods," Experimental 0506001, EconWPA.
    7. Guth, Werner & Levati, M. Vittoria & Sutter, Matthias & van der Heijden, Eline, 2007. "Leading by example with and without exclusion power in voluntary contribution experiments," Journal of Public Economics, Elsevier, vol. 91(5-6), pages 1023-1042, June.
    8. repec:ebl:ecbull:v:3:y:2008:i:23:p:1-11 is not listed on IDEAS
    9. Andrej Angelovski & Tibor Neugebauer & Maroš Servatka, 2017. "Can Rank-Order Competition Resolve the Free-Rider Problem in the Voluntary Provision of Impure Public Goods? Experimental Evidence," Working Papers CESARE 1705, Dipartimento di Economia e Finanza, LUISS Guido Carli.
    10. Neugebauer, Tibor & Perote, Javier & Schmidt, Ulrich & Loos, Malte, 2009. "Selfish-biased conditional cooperation: On the decline of contributions in repeated public goods experiments," Journal of Economic Psychology, Elsevier, vol. 30(1), pages 52-60, February.
    11. Eva-Maria Steiger & Ro'i Zultan, 2011. "See No Evil: Information Chains and Reciprocity in Teams," Jena Economic Research Papers 2011-040, Friedrich-Schiller-University Jena.
    12. Centorrino, Samuele & Concina, Laura, 2013. "A Competitive Approach to Leadership in Public Good Games," LERNA Working Papers 13.02.389, LERNA, University of Toulouse.
    13. M. Vittoria Levati & Ro’i Zultan, 2011. "Cycles of Conditional Cooperation in a Real-Time Voluntary Contribution Mechanism," Games, MDPI, Open Access Journal, vol. 2(1), pages 1-15, January.
    14. Werner Güth & M. Vittoria Levati & Matthias Sutter & Eline van der Heijden, 2004. "Leadership and cooperation in public goods experiments," Papers on Strategic Interaction 2004-29, Max Planck Institute of Economics, Strategic Interaction Group.
    15. Steiger, Eva-Maria & Zultan, Ro'i, 2014. "See no evil: Information chains and reciprocity," Journal of Public Economics, Elsevier, vol. 109(C), pages 1-12.
    16. M. Levati & Andrea Morone & Annamaria Fiore, 2009. "Voluntary contributions with imperfect information: An experimental study," Public Choice, Springer, vol. 138(1), pages 199-216, January.
    17. Xiaochuan Huang & Takehito Masuda & Yoshitaka Okano & Tatsuyoshi Saijo, 2014. "Cooperation among behaviorally heterogeneous players in social dilemma with stay or leave decisions," Working Papers SDES-2014-7, Kochi University of Technology, School of Economics and Management, revised Feb 2015.
    18. Maria Vittoria Levati, "undated". "Explaining Private Provision of Public Goods by Conditional Cooperation - An Evoltuionary Approach -," Papers on Strategic Interaction 2002-44, Max Planck Institute of Economics, Strategic Interaction Group.
    19. Centorrino, Samuele & Concina, Laura, 2013. "A Competitive Approach to Leadership in Public Good Games," TSE Working Papers 13-383, Toulouse School of Economics (TSE).

    More about this item


    Experimental Economics; Public Goods; Voluntary Contributions; Conditional Cooperation; Adaptive Behaviour.;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions

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