Cooperation Is Relative: Income and Framing Effects with Public Goods

Kjell Arne Brekke, James Konow () and Karine Nyborg

No 16/2012, Memorandum from Oslo University, Department of Economics

Abstract: In social dilemmas, there is tension between cooperation that promotes the common good and the pursuit of individual interests. International climate change negotiations provide one example: although abatement costs are borne by individual countries, the benefits are shared globally. We study a multi-period, threshold public goods game with unequally endowed participants and communication in which the decision variable is framed in three seemingly inconsequential ways: as absolute contributions, contributions relative to endowments and in terms of the effects of contributions on final payoffs. We find considerable agreement that “rich” (or high endowed) persons contribute more than “poor” (or low endowed) individuals at levels that are invariant across frames. Frames do, however, significantly affect both preferred and actual contributions for the poor: they contribute significantly less when the decision variable makes the effects on final payoffs salient than when it is framed in terms of absolute contributions. Contributions are explained mostly by self-interest, justice preferences, and experiencing failed negotiations, but we find no effects of reciprocity toward individuals or of the suggestions of others about what one should contribute.

Keywords: Public good game; threshold; communication; fairness; endowment heterogeneity (search for similar items in EconPapers)
JEL-codes: D63 D64 H41 (search for similar items in EconPapers)
Pages: 42 pages
Date: 2012-05-21
New Economics Papers: this item is included in nep-cbe, nep-evo, nep-exp and nep-pub
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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