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Funding a New Bridge in Rural Vietnam: A field experiment on conditional cooperation and default contributions

  • Carlsson, Fredrik

    ()

    (Department of Economics, School of Business, Economics and Law, Göteborg University)

  • Johansson-Stenman, Olof

    ()

    (Department of Economics, School of Business, Economics and Law, Göteborg University)

  • Pham Khanh, Nam

    ()

    (Faculty of Development Economics, University of Ho Chi Minh City)

The ability to provide public goods is essential for economic and social development, yet there is very limited empirical evidence regarding contributions to a real local public good in developing countries. This paper analyzes a field experiment where 200 households in rural Vietnam could make real contributions to an archetypical public good, a bridge. In particular, we study the role of two kinds of social influence: i) conditional cooperation, i.e., that people may be more willing to cooperate if others do, and ii) the effects of the default alternative, i.e., that people are influenced by the default alternative presented to them in the choice situation. We find significant and substantial effects of both kinds of influence. For example, by either giving the subjects the additional information that one of the most common contributions by others is 100,000 dong (a relatively low contribution) or introducing a zero-contribution default alternative, the average contribution decreases by about 20% compared to the baseline case.

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File URL: http://hdl.handle.net/2077/25547
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Paper provided by University of Gothenburg, Department of Economics in its series Working Papers in Economics with number 503.

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Length: 31 pages
Date of creation: 19 May 2011
Date of revision:
Handle: RePEc:hhs:gunwpe:0503
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Department of Economics, School of Business, Economics and Law, University of Gothenburg, Box 640, SE 405 30 GÖTEBORG, Sweden

Phone: 031-773 10 00
Web page: http://www.handels.gu.se/econ/

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