IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this paper

The Good of the Few: Reciprocal Acts and the Provision of a Public Bad

People trade favors when doing so increases efficiency. Will they when it reduces efficiency, such as in political logrolling? We introduce the "Stakeholder Public Bad" game, in which common fund contributions increase one person’s earnings (the "Stakeholder") while reducing others' earnings and overall efficiency. The Stakeholder position rotates through all group members or just alternates among two people (making it easier to form a coalition). High Stakeholder rewards provide a lever for reciprocity: if someone contributes when another is Stakeholder, he may be rewarded with a gift when he becomes Stakeholder. Reciprocity is only possible when agents know others' roles and actions, so information provision may be pro- or anti-social. In a laboratory experiment, we combine a rotating or alternating asymmetry in payoffs with varying levels of information provision to examine pro- and anti-social reciprocity. We find that subjects in the Stakeholder role willingly sacrifice social welfare. We also see both anti-social and pro-social favor trading, particularly when coalition-forming is easier. Favor trading does not change the mean level of public bad provision. People who trade favors tend to be less risk averse.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://web.williams.edu/Economics/wp/DelaneyJacobson_GoodOfTheFew.pdf
File Function: Full text
Download Restriction: no

Paper provided by Department of Economics, Williams College in its series Department of Economics Working Papers with number 2014-03.

as
in new window

Length: 32 pages
Date of creation: Jan 2012
Date of revision: Jun 2015
Handle: RePEc:wil:wileco:2014-03
Contact details of provider: Postal:
Williamstown, MA 01267

Phone: 413 597 2476
Fax: 413 597 4045
Web page: http://econ.williams.edu
Email:


More information through EDIRC

Order Information: Email:


References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Ferraro, Paul J. & Rondeau, Daniel & Poe, Gregory L., 2000. "Detecting Other-Regarding Behavior with Virtual Players," Working Papers 179537, Cornell University, Department of Applied Economics and Management.
  2. James C. Cox & Daniel Friedman & Vjollca Sadiraj, . "Revealed Altruism," Experimental Economics Center Working Paper Series 2006-09, Experimental Economics Center, Andrew Young School of Policy Studies, Georgia State University, revised Jul 2007.
  3. Sonnemans, Joep & Schram, Arthur & Offerman, Theo, 1998. "Public good provision and public bad prevention: The effect of framing," Journal of Economic Behavior & Organization, Elsevier, vol. 34(1), pages 143-161, January.
  4. Gary Charness & Matthew Rabin, 2002. "Understanding Social Preferences with Simple Tests," The Quarterly Journal of Economics, Oxford University Press, vol. 117(3), pages 817-869.
  5. John A. List, 2005. "The Behavioralist Meets the Market: Measuring Social Preferences and Reputation Effects in Actual Transactions," NBER Working Papers 11616, National Bureau of Economic Research, Inc.
  6. Fehr, Ernst & Schmidt, Klaus M., 1998. "A Theory of Fairness, Competition and Cooperation," CEPR Discussion Papers 1812, C.E.P.R. Discussion Papers.
  7. Andreoni, J., 1993. "Cooperation in Public Goods Experiments: Kindness or Confusion?," Working papers 9309, Wisconsin Madison - Social Systems.
  8. James Andreoni, 1994. "Warm-Glow versus Cold-Prickle: The Effects of Positive and Negative Framing on Cooperation in Experiments," Experimental 9410002, EconWPA.
  9. Hilde Coffé & Catherine Bolzendahl, 2011. "Partisan Cleavages in the Importance of Citizenship Rights and Responsibilities," Social Science Quarterly, Southwestern Social Science Association, vol. 92(3), pages 656-674, 09.
  10. Murray, Cameron K. & Frijters, Paul & Vorster, Melissa, 2015. "Give and You Shall Receive: The Emergence of Welfare-Reducing Reciprocity," IZA Discussion Papers 9010, Institute for the Study of Labor (IZA).
  11. Reuben, Ernesto & Riedl, Arno, 2007. "Public Goods Provision and Sanctioning in Priveleged Groups," Research Memorandum 028, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
  12. Dean S. Karlan, 2005. "Using Experimental Economics to Measure Social Capital and Predict Financial Decisions," American Economic Review, American Economic Association, vol. 95(5), pages 1688-1699, December.
  13. Wilson, Bart J., 2008. "Language games of reciprocity," Journal of Economic Behavior & Organization, Elsevier, vol. 68(2), pages 365-377, November.
  14. Cox, James C., 2004. "How to identify trust and reciprocity," Games and Economic Behavior, Elsevier, vol. 46(2), pages 260-281, February.
  15. Berg Joyce & Dickhaut John & McCabe Kevin, 1995. "Trust, Reciprocity, and Social History," Games and Economic Behavior, Elsevier, vol. 10(1), pages 122-142, July.
  16. Rabin, Matthew, 1993. "Incorporating Fairness into Game Theory and Economics," American Economic Review, American Economic Association, vol. 83(5), pages 1281-1302, December.
  17. Abbink, Klaus & Bernd Irlenbusch & Elke Renner, 1997. "The Moonlighting Game - An Experimental Study on Reciprocity and Retribution," Discussion Paper Serie B 415, University of Bonn, Germany.
  18. James Andreoni & Ragan Petrie, 2003. "Public Goods Experiments Without Confidentiality: A Glimpse Into Fund-Raising," Levine's Working Paper Archive 506439000000000520, David K. Levine.
  19. Ulrike M. Malmendier & Klaus Schmidt, 2012. "You Owe Me," CESifo Working Paper Series 4007, CESifo Group Munich.
  20. Benyamin Shitovitz & Menahem Spiegel, 2003. "Cournot-Nash and Lindahl equilibria in pure public “bad” economies," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 22(1), pages 17-31, 08.
  21. Andreas Glöckner & Bernd Irlenbusch & Sebastian Kube & Andreas Nicklisch & Hans‐Theo Normann, 2011. "Leading With(Out) Sacrifice? A Public‐Goods Experiment With A Privileged Player," Economic Inquiry, Western Economic Association International, vol. 49(2), pages 591-597, 04.
  22. Sarah Jacobson & Ragan Petrie, 2012. "Favor Trading in Public Good Provision," Working Papers 1032, George Mason University, Interdisciplinary Center for Economic Science.
  23. Pevnitskaya, Svetlana & Ryvkin, Dmitry, 2013. "Environmental context and termination uncertainty in games with a dynamic public bad," Environment and Development Economics, Cambridge University Press, vol. 18(01), pages 27-49, February.
  24. Ekaterina Sherstyuk & Nori Tarui & Majah-Leah Ravago & Tatsuyoshi Saijo, 2015. "Intergenerational Games with Dynamic Externalities and Climate Change Experiments," Working Papers 201509, University of Hawaii at Manoa, Department of Economics.
  25. Charles A. Holt & Susan K. Laury, 2002. "Risk Aversion and Incentive Effects," American Economic Review, American Economic Association, vol. 92(5), pages 1644-1655, December.
  26. Jordi Brandts & David J. Cooper & Enrique Fatas, 2006. "Leadership and Overcoming Coordination Failure with Asymmetric Costs," UFAE and IAE Working Papers 691.07, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
  27. Barr, Abigail & Serra, Danila, 2010. "Corruption and culture: An experimental analysis," Journal of Public Economics, Elsevier, vol. 94(11-12), pages 862-869, December.
  28. Goeree, Jacob K. & Holt, Charles A. & Laury, Susan K., 2002. "Private costs and public benefits: unraveling the effects of altruism and noisy behavior," Journal of Public Economics, Elsevier, vol. 83(2), pages 255-276, February.
  29. Sarah Jacobson & Jason Delaney, 2013. "Those Outsiders: How Downstream Externalities Affect Public Good Provision," Department of Economics Working Papers 2013-09, Department of Economics, Williams College.
  30. Georg Kirchsteiger & Ernst Fehr & Arno Riedl, 1993. "Does Fairness Prevent Market Clearing? An Experimental Investigation," ULB Institutional Repository 2013/5927, ULB -- Universite Libre de Bruxelles.
  31. Lauren Cohen & Christopher J. Malloy, 2014. "Friends in High Places," American Economic Journal: Economic Policy, American Economic Association, vol. 6(3), pages 63-91, August.
  32. repec:pri:rpdevs:gamespaper is not listed on IDEAS
  33. Erling Moxnes & Eline van der Heijden, 2003. "The Effect of Leadership in a Public Bad Experiment," Journal of Conflict Resolution, Peace Science Society (International), vol. 47(6), pages 773-795, December.
  34. Marwell, Gerald & Ames, Ruth E., 1981. "Economists free ride, does anyone else? : Experiments on the provision of public goods, IV," Journal of Public Economics, Elsevier, vol. 15(3), pages 295-310, June.
  35. Daniel Houser & Robert Kurzban, 2002. "Revisiting Kindness and Confusion in Public Goods Experiments," American Economic Review, American Economic Association, vol. 92(4), pages 1062-1069, September.
  36. James C. Cox & Cary A. Deck, 2005. "On the Nature of Reciprocal Motives," Economic Inquiry, Western Economic Association International, vol. 43(3), pages 623-635, July.
  37. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer, vol. 10(2), pages 171-178, June.
  38. Ananish Chaudhuri, 2011. "Sustaining cooperation in laboratory public goods experiments: a selective survey of the literature," Experimental Economics, Springer, vol. 14(1), pages 47-83, March.
  39. Abigail Barr & Danila Serra, 2008. "The effects of externalities and framing on bribery in a petty corruption experiment," Economics Series Working Papers WPS/2008-24, University of Oxford, Department of Economics.
  40. Christoph Engel & Bettina Rockenbach, 2009. "We Are Not Alone: The Impact of Externalities on Public Good Provision," Working Paper Series of the Max Planck Institute for Research on Collective Goods 2009_29, Max Planck Institute for Research on Collective Goods, revised May 2011.
  41. 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.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:wil:wileco:2014-03. 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: (Stephen Sheppard)

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 references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link 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 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.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.