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Delegation and Coordination with Multiple Threshold Public Goods: Experimental Evidence

Author

Listed:
  • Luca Corazzini
  • Christopher Cotton

    () (Queen's University)

  • Tommaso Reggiani

Abstract

When multiple charities, social programs and community projects simultaneously vie for funding, donors risk miscoordinating their contributions leading to an inefficient distribution of funding across projects. Community chests and other intermediary organizations facilitate coordination among donors and reduce such risks. We explore such considerations by extending the threshold public goods framework to allow donors to contribute to an intermediary rather than directly to the public goods. We experimentally study the effects of the intermediary on contributions and successful public good funding. Results show that delegation increases overall contributions and public good success, but only when the intermediary is formally committed to direct funding received from donors to socially beneficial goods. Without such a restriction, the presence of an intermediary is detrimental, resulting in lower contributions, a higher probability of miscoordination, and lower payoffs.

Suggested Citation

  • Luca Corazzini & Christopher Cotton & Tommaso Reggiani, 2019. "Delegation and Coordination with Multiple Threshold Public Goods: Experimental Evidence," Working Paper 1412, Economics Department, Queen's University.
  • Handle: RePEc:qed:wpaper:1412
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    File URL: https://www.econ.queensu.ca/sites/econ.queensu.ca/files/wpaper/qed_wp_1412.pdf
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    References listed on IDEAS

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    Cited by:

    1. Ondřej Krčál & Rostislav Staněk & Bára Karlínová & Stefanie Peer, 2019. "Real consequences matters: why hypothetical biases in the valuation of time persist even in controlled lab experiments," MUNI ECON Working Papers 2019-03, Masaryk University.

    More about this item

    Keywords

    delegation; threshold public goods; laboratory experiment; fundraising;

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • H40 - Public Economics - - Publicly Provided Goods - - - General
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • L31 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Nonprofit Institutions; NGOs; Social Entrepreneurship

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