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A Competitive Approach to Leadership in Public Good Games

  • Centorrino, Samuele
  • Concina, Laura
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    We show that introducing a competitive preliminary stage in a sequential public good game helps select one of the more cooperative leaders in the group. Using a modified second price auction, we find that bids have a strong positive predictive power on individual contributions. Moreover, evidence is provided that trust can explain voluntary and cooperative leadership. However, followers reaction to voluntary leaders may rise free riding behaviour, with uncertain effect on total public good provision.

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    File URL: http://www.tse-fr.eu/sites/default/files/medias/doc/wp/env/wp_tse_383.pdf
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    Paper provided by Toulouse School of Economics (TSE) in its series TSE Working Papers with number 13-383.

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    Date of creation: Feb 2013
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    Handle: RePEc:tse:wpaper:26933
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    Web page: http://www.tse-fr.eu/

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    1. Nicholas Bardsley & Peter Moffatt, 2007. "The Experimetrics of Public Goods: Inferring Motivations from Contributions," Theory and Decision, Springer, vol. 62(2), pages 161-193, March.
    2. Urs Fischbacher & Simon Gaechter, 2009. "Social Preferences, Beliefs, and the Dynamics of Free Riding in Public Good Experiments," Discussion Papers 2009-04, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
    3. Potters, J.J.M. & Sefton, M. & Vesterlund, L., 2003. "After You - Endogenous Sequencing in Voluntary Contribution Games," Discussion Paper 2003-98, Tilburg University, Center for Economic Research.
    4. Ben Hermalin, 1996. "Toward an Economic Theory of Leadership: Leading by Example," Working Papers _006, University of California at Berkeley, Haas School of Business.
    5. Fehr, Ernst & Fischbacher, Urs & von Rosenbladt, Bernhard & Schupp, Jürgen & Wagner, Gert G., 2003. "A Nation-Wide Laboratory: Examining Trust and Trustworthiness by Integrating Behavioral Experiments into Representative Surveys," IZA Discussion Papers 715, Institute for the Study of Labor (IZA).
    6. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer, vol. 10(2), pages 171-178, June.
    7. Andreoni, James & Brown, Paul M. & Vesterlund, Lise, 2002. "What Makes an Allocation Fair? Some Experimental Evidence," Games and Economic Behavior, Elsevier, vol. 40(1), pages 1-24, July.
    8. Emrah Arbak & Marie-Claire Villeval, 2007. "Endogenous Leadership Selection and Influence," Post-Print halshs-00142461, HAL.
    9. Edward Cartwright & Amrish Patel, 2010. "Imitation and the Incentive to Contribute Early in a Sequential Public Good Game," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 12(4), pages 691-708, 08.
    10. Raphaële Préget & Phu Nguyen-Van & Marc Willinger, 2012. "Who are the Voluntary Leaders? Experimental Evidence from a Sequential Contribution Game," Working Papers 12-34, LAMETA, Universtiy of Montpellier, revised Nov 2012.
    11. Edward L. Glaeser & David I. Laibson & José A. Scheinkman & Christine L. Soutter, 2000. "Measuring Trust," The Quarterly Journal of Economics, MIT Press, vol. 115(3), pages 811-846, August.
      • Glaeser, Edward Ludwig & Laibson, David I. & Scheinkman, Jose A. & Soutter, Christine L., 2000. "Measuring Trust," Scholarly Articles 4481497, Harvard University Department of Economics.
    12. Richard Ashley & Sheryl Ball & Catherine Eckel, 2010. "Motives for Giving: A Reanalysis of Two Classic Public Goods Experiments," Southern Economic Journal, Southern Economic Association, vol. 77(1), pages 15-26, July.
    13. Jan Potters & Martin Sefton & Lise Vesterlund, 2007. "Leading-by-example and signaling in voluntary contribution games: an experimental study," Economic Theory, Springer, vol. 33(1), pages 169-182, October.
    14. Potters, J.J.M. & Sefton, M. & Vesterlund, L., 2001. "Why Announce Leadership Contributions? An Experimental Study of the Signaling and Reciprocity Hypotheses," Discussion Paper 2001-100, Tilburg University, Center for Economic Research.
    15. Gachter, Simon & Herrmann, Benedikt & Thoni, Christian, 2004. "Trust, voluntary cooperation, and socio-economic background: survey and experimental evidence," Journal of Economic Behavior & Organization, Elsevier, vol. 55(4), pages 505-531, December.
    16. Gächter, Simon & Nosenzo, Daniele & Renner, Elke & Sefton, Martin, 2010. "Sequential vs. simultaneous contributions to public goods: Experimental evidence," Journal of Public Economics, Elsevier, vol. 94(7-8), pages 515-522, August.
    17. Werner Güth & M. Vittoria Levati & Matthias Sutter & Eline van der Heijden, 2006. "Leading by example with and without exclusion power in voluntary contribution experiments," Papers on Strategic Interaction 2006-35, Max Planck Institute of Economics, Strategic Interaction Group.
    18. Kagel, John H & Levin, Dan, 1993. "Independent Private Value Auctions: Bidder Behaviour in First-, Second- and Third-Price Auctions with Varying Numbers of Bidders," Economic Journal, Royal Economic Society, vol. 103(419), pages 868-79, July.
    19. Andreoni, James, 1989. "Giving with Impure Altruism: Applications to Charity and Ricardian Equivalence," Journal of Political Economy, University of Chicago Press, vol. 97(6), pages 1447-58, December.
    20. Haigner, Stefan D. & Wakolbinger, Florian, 2010. "To lead or not to lead: Endogenous sequencing in public goods games," Economics Letters, Elsevier, vol. 108(1), pages 93-95, July.
    21. Romano, Richard & Yildirim, Huseyin, 2001. "Why charities announce donations: a positive perspective," Journal of Public Economics, Elsevier, vol. 81(3), pages 423-447, September.
    22. Varian, Hal R., 1994. "Sequential contributions to public goods," Journal of Public Economics, Elsevier, vol. 53(2), pages 165-186, February.
    23. M. Vittoria Levati & Tibor Neugebauer, 2004. "An Application of the English Clock Market Mechanism to Public Goods Games," Experimental Economics, Springer, vol. 7(2), pages 153-169, 06.
    24. Cagri S. Kumru & Lise Vesterlund, 2010. "The Effect of Status on Charitable Giving," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 12(4), pages 709-735, 08.
    25. Rivas, M. Fernanda & Sutter, Matthias, 2011. "The benefits of voluntary leadership in experimental public goods games," Economics Letters, Elsevier, vol. 112(2), pages 176-178, August.
    26. Catherine C. Eckel & Enrique Fatas & Rick Wilson, 2010. "Cooperation and Status in Organizations," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 12(4), pages 737-762, 08.
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