The public loss game: An experimental study of public bads

Stephan Schosser and Bodo Vogt

No 33, Working Paper Series in Economics from Karlsruhe Institute of Technology (KIT), Department of Economics and Management

Abstract: We analyze cooperative behavior of participants who faced a loss. In particular, we extend the Public Good Game by a fixed loss in the beginning of every period. We show that humans change their behavior compared to corresponding studies with gains only. First, in contrast to literature on gains, we observe significant order effects. When participants first play a treatment with punishment, they cooperate less and face higher punishment costs than when first playing a treatment without punishment. The changes are that drastic that punishment does not pay in the first case, while it does in the later. Second, for participants first playing without punishment the contributions in the very first period of play determine the contributions throughout both treatments of the game, yielding higher contributions in the punishment treatment than when playing with gains. Participants punishing first, show no comparable behavior.

Keywords: public good; punishment; losses; experiment (search for similar items in EconPapers)
Date: 2011
New Economics Papers: this item is included in nep-cbe, nep-evo, nep-exp and nep-gth
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:kitwps:33

DOI: 10.5445/IR/1000024153

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