IDEAS home Printed from https://ideas.repec.org/p/exe/wpaper/1207.html
   My bibliography  Save this paper

The Effect of Social Fragmentation on Public Good Provision: an Experimental Study

Author

Listed:
  • Surajeet Chakravarty

    (Department of Economics, University of Exeter)

  • Miguel A. Fonseca

    (Department of Economics, University of Exeter)

Abstract

We study the role of social identity in determining the impact of social frag- mentation on public good provision using laboratory experiments. We nd that as long as there is some degree of social fragmentation, increasing it leads to lower public good provision. This is mainly because the share of those who contribute fully to the public good diminishes with social fragmentation, while the share of free-riders is unchanged, which suggests social identity preferences drive our result, as opposed to self-interest. Importantly, socially homogeneous groups do not generate the highest contributions: some social diversity is actually welfare-improving. Finally, social fragmentation is felt differently for visible minorities, whose contributions are higher than minority groups whose actions are not identiable.

Suggested Citation

  • Surajeet Chakravarty & Miguel A. Fonseca, 2012. "The Effect of Social Fragmentation on Public Good Provision: an Experimental Study," Discussion Papers 1207, Exeter University, Department of Economics.
  • Handle: RePEc:exe:wpaper:1207
    as

    Download full text from publisher

    File URL: http://people.exeter.ac.uk/cc371/RePEc/dpapers/DP1207.pdf
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. La Porta, Rafael & Lopez-de-Silanes, Florencio & Shleifer, Andrei & Vishny, Robert, 1999. "The Quality of Government," Journal of Law, Economics, and Organization, Oxford University Press, vol. 15(1), pages 222-279, April.
    2. Erzo F. P. Luttmer, 2001. "Group Loyalty and the Taste for Redistribution," Journal of Political Economy, University of Chicago Press, vol. 109(3), pages 500-528, June.
    3. Simon Gachter & Ernst Fehr, 2000. "Cooperation and Punishment in Public Goods Experiments," American Economic Review, American Economic Association, vol. 90(4), pages 980-994, September.
    4. Alberto Alesina & Eliana La Ferrara, 2000. "Participation in Heterogeneous Communities," The Quarterly Journal of Economics, Oxford University Press, vol. 115(3), pages 847-904.
    5. Lorenz Goette & David Huffman & Stephan Meier, 2006. "The Impact of Group Membership on Cooperation and Norm Enforcement: Evidence Using Random Assignment to Real Social Groups," American Economic Review, American Economic Association, vol. 96(2), pages 212-216, May.
    6. Wit, Arjaan P. & Wilke, Henk A. M., 1992. "The effect of social categorization on cooperation in three types of social dilemmas," Journal of Economic Psychology, Elsevier, vol. 13(1), pages 135-151, March.
    7. Gary Charness & Luca Rigotti & Aldo Rustichini, 2007. "Individual Behavior and Group Membership," American Economic Review, American Economic Association, vol. 97(4), pages 1340-1352, September.
    8. Smith, Alexander, 2011. "Group composition and conditional cooperation," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 40(5), pages 616-622.
    9. Brown-Kruse, Jamie & Hummels, David, 1993. "Gender effects in laboratory public goods contribution : Do individuals put their money where their mouth is?," Journal of Economic Behavior & Organization, Elsevier, vol. 22(3), pages 255-267, December.
    10. DeanS. Karlan, 2007. "Social connections and group banking," Economic Journal, Royal Economic Society, vol. 117(517), pages 52-84, February.
    11. George A. Akerlof & Rachel E. Kranton, 2000. "Economics and Identity," The Quarterly Journal of Economics, Oxford University Press, vol. 115(3), pages 715-753.
    12. Bram Cadsby, C. & Maynes, Elizabeth, 1998. "Gender and free riding in a threshold public goods game: Experimental evidence," Journal of Economic Behavior & Organization, Elsevier, vol. 34(4), pages 603-620, March.
    13. Drouvelis, Michalis & Nosenzo, Daniele, 2013. "Group identity and leading-by-example," Journal of Economic Psychology, Elsevier, vol. 39(C), pages 414-425.
    14. Siwan Anderson, 2011. "Caste as an Impediment to Trade," American Economic Journal: Applied Economics, American Economic Association, vol. 3(1), pages 239-263, January.
    15. Amelie F. Constant & Klaus F. Zimmermann, 2008. "Measuring Ethnic Identity and its Impact on Economic Behavior," Journal of the European Economic Association, MIT Press, vol. 6(2-3), pages 424-433, 04-05.
    16. Alberto Alesina & Eliana La Ferrara, 2003. "Ethnic Diversity and Economic Performance," Harvard Institute of Economic Research Working Papers 2028, Harvard - Institute of Economic Research.
    17. Morita, Hodaka & Servátka, Maroš, 2013. "Group identity and relation-specific investment: An experimental investigation," European Economic Review, Elsevier, vol. 58(C), pages 95-109.
    18. Sergio Currarini & Matthew O. Jackson & Paolo Pin, 2009. "An Economic Model of Friendship: Homophily, Minorities, and Segregation," Econometrica, Econometric Society, vol. 77(4), pages 1003-1045, July.
    19. Eliana La Ferrara, 2003. "Kin Groups and Reciprocity: A Model of Credit Transactions in Ghana," American Economic Review, American Economic Association, vol. 93(5), pages 1730-1751, December.
    20. McLeish, Kendra N. & Oxoby, Robert J., 2007. "Identity, Cooperation, and Punishment," IZA Discussion Papers 2572, Institute for the Study of Labor (IZA).
    21. Miguel, Edward & Gugerty, Mary Kay, 2005. "Ethnic diversity, social sanctions, and public goods in Kenya," Journal of Public Economics, Elsevier, vol. 89(11-12), pages 2325-2368, December.
    22. Alberto Alesina & Reza Baqir & William Easterly, 1999. "Public Goods and Ethnic Divisions," The Quarterly Journal of Economics, Oxford University Press, vol. 114(4), pages 1243-1284.
    23. Poterba, James M, 1998. "Demographic Change, Intergenerational Linkages, and Public Education," American Economic Review, American Economic Association, vol. 88(2), pages 315-320, May.
    24. repec:cup:apsrev:v:103:y:2009:i:02:p:147-174_09 is not listed on IDEAS
    25. Solow, John L. & Kirkwood, Nicole, 2002. "Group identity and gender in public goods experiments," Journal of Economic Behavior & Organization, Elsevier, vol. 48(4), pages 403-412, August.
    26. Eckel, Catherine C. & Grossman, Philip J., 2005. "Managing diversity by creating team identity," Journal of Economic Behavior & Organization, Elsevier, vol. 58(3), pages 371-392, November.
    27. repec:hrv:faseco:30747160 is not listed on IDEAS
    28. E. Paul Durrenberger, 2005. "Labour," Chapters,in: A Handbook of Economic Anthropology, chapter 8 Edward Elgar Publishing.
    29. Fabio Galeotti & Daniel John Zizzo, 2012. "Trust and trustworthiness with singleton groups," Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) 12-03, School of Economics, University of East Anglia, Norwich, UK..
    30. Yan Chen & Sherry Xin Li, 2009. "Group Identity and Social Preferences," American Economic Review, American Economic Association, vol. 99(1), pages 431-457, March.
    31. Khwaja, Asim Ijaz, 2009. "Can good projects succeed in bad communities?," Journal of Public Economics, Elsevier, vol. 93(7-8), pages 899-916, August.
    32. Bowles, Samuel & Gintis, Herbert, 2004. "Persistent parochialism: trust and exclusion in ethnic networks," Journal of Economic Behavior & Organization, Elsevier, vol. 55(1), pages 1-23, September.
    33. Habyarimana, James P. & Humphreys, Macartan & Posner, Daniel N. & Weinstein, Jeremy, 2006. "Why Does Ethnic Diversity Undermine Public Goods Provision? An Experimental Approach," IZA Discussion Papers 2272, Institute for the Study of Labor (IZA).
    34. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer;Economic Science Association, vol. 10(2), pages 171-178, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. repec:bla:jpbect:v:19:y:2017:i:1:p:244-263 is not listed on IDEAS
    2. Surajeet Chakravarty & Miguel A. Fonseca, 2017. "Discrimination via Exclusion: An Experiment on Group Identity and Club Goods," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 19(1), pages 244-263, February.
    3. Lapointe, Simon, 2018. ""Love Thy Neighbour"? The Effect of Income and Language Differences on Votes for Municipal Secessions," Working Papers 107, VATT Institute for Economic Research.
    4. Chakravarty, Surajeet & Fonseca, Miguel A. & Ghosh, Sudeep & Marjit, Sugata, 2016. "Religious fragmentation, social identity and cooperation: Evidence from an artefactual field experiment in India," European Economic Review, Elsevier, vol. 90(C), pages 265-279.
    5. Sergio Currarini & Friederike Menge, 2012. "Identity, Homophily and In-Group Bias," Working Papers 2012.37, Fondazione Eni Enrico Mattei.
    6. Currarini, Sergio & Mengel, Friederike, 2016. "Identity, homophily and in-group bias," European Economic Review, Elsevier, vol. 90(C), pages 40-55.
    7. Bicskei, Marianna & Lankau, Matthias & Bizer, Kilian, 2014. "How peer-punishment affects cooperativeness in homogeneous and heterogeneous groups: A public goods experiment with social identity," Center for European, Governance and Economic Development Research Discussion Papers 200, University of Goettingen, Department of Economics.
    8. Fabio Galeotti & Daniel Zizzo, 2014. "What happens if you single out? An experiment," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 43(3), pages 703-729, October.
    9. Frédéric Gaspart & Pierre Pecher, 2015. "Ethnic inclusiveness of the central state government and economic growth in sub-Saharan Africa," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2015011, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    10. Tjaša Bjedov & Simon Lapointe & Thierry Madiès & Marie Villeval, 2018. "Does decentralization of decisions increase the stability of large groups?," Working Papers halshs-01691475, HAL.
    11. Drouvelis, Michalis & Nosenzo, Daniele, 2013. "Group identity and leading-by-example," Journal of Economic Psychology, Elsevier, vol. 39(C), pages 414-425.
    12. Weng, Qian, 2013. "Session Size and its Effect on Identity Building: Evidence from a public goods experiment," Working Papers in Economics 560, University of Gothenburg, Department of Economics.
    13. Chiara Ravetti & Mare Sarr & Tim Swanson & Daniel Munene, 2017. "Discrimination and favouritism among workers: union membership and ethnic identity," CIES Research Paper series 57-2017, Centre for International Environmental Studies, The Graduate Institute.
    14. Dimitrova-Grajzl Valentina & Grajzl Peter & Guse A. Joseph & Smith J. Taylor, 2016. "Racial Group Affinity and Religious Giving: Evidence from Congregation-Level Panel Data," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 16(2), pages 689-725, April.
    15. Barnes, Michele L. & Arita, Shawn & Kalberg, Kolter & Leung, PingSun, 2017. "When does it pay to cooperate? Strategic information exchange in the harvest of common-pool fishery resources," Ecological Economics, Elsevier, vol. 131(C), pages 1-11.
    16. repec:bla:indres:v:56:y:2017:i:4:p:555-604 is not listed on IDEAS

    More about this item

    Keywords

    Social Identity; Public Goods; Social Fragmentation; Experiments.;

    JEL classification:

    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:exe:wpaper:1207. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Carlos Cortinhas). General contact details of provider: http://edirc.repec.org/data/deexeuk.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.