An experimental study on voluntary vs. compulsory provision of public goods under the vote-with-feet mechanism

Hui-Chun Peng ()
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Hui-Chun Peng: National Taipei University

Evolutionary and Institutional Economics Review, 2021, vol. 18, issue 1, No 1, 19 pages

Abstract: Abstract This paper conducts laboratory experiments to investigate how the individuals with heterogeneous income levels endogenously select the institution in public good provision in a Tiebout-like environment. According to the experimental results, I find that heterogeneous individuals have different choices of contribution institutions. High-income individuals tend to participate in the voluntary contribution institution, but low-income individuals tend to choose the compulsory one. I also find that most high-income individuals in the voluntary contribution institution try to free ride on others. Therefore, although the vote-with-feet mechanism helps to sort heterogeneous individuals in different contribution institutions, it may not enhance the cooperation among the individuals in the voluntary contribution community.

Keywords: Compulsory contribution; Voluntary contribution; Vote-with-feet mechanism (search for similar items in EconPapers)
JEL-codes: C91 H41 (search for similar items in EconPapers)
Date: 2021
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DOI: 10.1007/s40844-020-00192-z

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