Growing groups, cooperation, and the rate of entry

Eva Ranehill, Frédéric Schneider and Roberto Weber

No 103, ECON - Working Papers from Department of Economics - University of Zurich

Abstract: We study the stability of voluntary cooperation in response to varying group growth rates. Using a laboratory public-good game, we construct a situation where increasing group size yields potential efficiency gains, but only with sustained cooperation. We then study the effect of exogenously varying growth rates on cooperation. Slow growth yields higher cooperation rates and welfare than fast growth, both for incumbents and entrants, which is consistent with optimistic self-reinforcing beliefs persisting under slower growth. Allowing incumbent group members to select growth rates also sustains high cooperation rates, but growth stalls at intermediate group sizes, leaving potential efficiency gains unrealized.

Keywords: Voluntary cooperation; experiment; public good game (search for similar items in EconPapers)
JEL-codes: C72 C92 (search for similar items in EconPapers)
Date: 2012-12, Revised 2013-05
New Economics Papers: this item is included in nep-cbe, nep-cdm, nep-evo, nep-exp and nep-gth
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Related works:
Working Paper: Growing Groups, Cooperation, and the Rate of Entry (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:zur:econwp:103

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