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Dealing with the aversion to the sucker’s payoff in public goods game

Author

Listed:
  • Douadia Bougherara
  • Sandrine Costa
  • Gilles Grolleau
  • Lisette Ibanez

Abstract

A usual explanation to low levels of contribution to public goods is the fear of getting the sucker’s payoff (cooperation by the participant and defection by the other players). In order to disentangle the effect of this fear from other motives, we design a public good game where people have an insurance against getting the sucker’s payoff. We show that contributions to the public good under this ‘protective’ design are significantly higher and interact with expectations on other individuals' contribution to the public good. Some policy implications and extensions are suggested.

Suggested Citation

  • Douadia Bougherara & Sandrine Costa & Gilles Grolleau & Lisette Ibanez, 2009. "Dealing with the aversion to the sucker’s payoff in public goods game," Working Papers 09-27, LAMETA, Universtiy of Montpellier, revised Dec 2009.
  • Handle: RePEc:lam:wpaper:09-27
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    File URL: http://www.lameta.univ-montp1.fr/Documents/DR2009-27.pdf
    File Function: First version, 2009
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    References listed on IDEAS

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    1. John A. List & David Lucking-Reiley, 2002. "The Effects of Seed Money and Refunds on Charitable Giving: Experimental Evidence from a University Capital Campaign," Journal of Political Economy, University of Chicago Press, vol. 110(1), pages 215-233, February.
    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. Bruno Frey & Matthias Benz & Alois Stutzer, 2004. "Introducing Procedural Utility: Not Only What, but Also How Matters," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 160(3), pages 377-377, September.
    4. 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.
    5. Cason, Timothy N. & Gangadharan, Lata, 2002. "Environmental Labeling and Incomplete Consumer Information in Laboratory Markets," Journal of Environmental Economics and Management, Elsevier, vol. 43(1), pages 113-134, January.
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    Cited by:

    1. Delacote, Philippe & Montagné-Huck, Claire, 2012. "Political consumerism and public policy: Good complements against market failures?," Ecological Economics, Elsevier, vol. 73(C), pages 188-193.

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