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On the scope of externalities in experimental markets

Björn Bartling (), Vanessa Valero () and Roberto Weber ()
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Björn Bartling: University of Zurich
Vanessa Valero: University of Zurich
Roberto Weber: University of Zurich

Experimental Economics, 2019, vol. 22, issue 3, 610-624

Abstract: Abstract We study how the scope of negative externalities from market activity affects the willingness of market actors to exhibit social responsibility. Using the laboratory experimental paradigm introduced by Bartling et al. (Q J Econ 130(1):219–266, 2015), we compare the voluntary internalization of negative social impacts by market actors in cases where the negative externality is diffused among many subjects or is concentrated on a single subject. We (1) replicate earlier results demonstrating substantial degrees of market social responsibility and (2) find that the willingness of market actors to act pro-socially is only slightly affected by whether the impacts are concentrated or diffused.

Keywords: Negative externalities; Scope of externalities; Social responsibility; Market experiments (search for similar items in EconPapers)
JEL-codes: C92 D62 M14 (search for similar items in EconPapers)
Date: 2019
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