The sandwich property in the voluntary contribution mechanism:The instability approach

Tatsuyoshi Saijo ()

No SDES-2015-13, Working Papers from Kochi University of Technology, School of Economics and Management

Abstract: This paper proposes an alternative explanation for the sandwich property in voluntary contribution mechanism experiments. This property refers to the phenomenon of experimental data being ``sandwiched'' between a Nash equilibrium above the midpoint of the endowment and a Nash equilibrium below this midpoint. The explanation is in terms of the instability of the system with best response dynamics, i.e., ``pulsing'' behaviors, in nonlinear environments rather than the quantal response equilibrium analysis. Since most experimental models are unstable in quasilinear environments (where the utility function is linear in a private good and nonlinear in a public good), and Cobb–Douglas environments, using equilibrium analysis is problematic.

JEL-codes: C62 C72 C92 H41 (search for similar items in EconPapers)
Pages: 15 pages
Date: 2015-03, Revised 2015-03
New Economics Papers: this item is included in nep-exp, nep-gth and nep-upt
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Published in SDE Series, March 2015, pages 1-15

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Persistent link: https://EconPapers.repec.org/RePEc:kch:wpaper:sdes-2015-13

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