Voluntary contributions with imperfect information: An experimental study

Annamaria Fiore (), Maria Vittoria Levati () and Andrea Morone ()

Discussion Papers on Strategic Interaction from Max Planck Institute of Economics, Strategic Interaction Group

Abstract: We use a two-person linear voluntary contribution mechanism with stochastic marginal benefits from the public good to examine the effect of imperfect information on contributions levels. To assess prior risk attitudes, individual valuations of several risky prospects are elicited via a second-price auction. We find that limited information about the productivity of the public good lowers significantly initial contributions in comparison to a setting with perfect information, whereas different information conditions do not result in qualitatively different contribution patterns. Moreover, our results show clear evidence of risk aversion, and of a negative relationship between the latter and willingness to cooperate.

Keywords: Public goods experiments; Vickrey auctions; Imperfect information; Risk attitudes (search for similar items in EconPapers)
JEL-codes: C72 C92 D80 H41 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cbe, nep-exp, nep-pbe and nep-upt
Date: Written 2006-11
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