The seeds of success: the pivotal role of first round cooperation in public goods games

Mehmet Y. Gürdal (), Orhan Torul and Mustafa Yahşi ()
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Mehmet Y. Gürdal: Boğaziçi University
Mustafa Yahşi: Koç University

Journal of the Economic Science Association, 2024, vol. 10, issue 1, No 8, 113-135

Abstract: Abstract This paper examines cooperation and punishment in a public goods game in Istanbul. Unlike prior within-subject designs, we use a between-subject design with separate no-punishment and punishment conditions. This approach reveals that punishment significantly increases contributions, demonstrating the detrimental effect of having prior experience without sanctions. We highlight two critical factors—heterogeneous initial contributions across groups and how subjects update their contributions based on prior contributions and received punishment. An agent-based model verifies that the interaction between these two factors leads to a strong persistence of contributions over time. Analysis of related data from comparable cities shows similar patterns, suggesting our findings likely generalize if using a between-subject design. We conclude that overlooking within-group heterogeneity biases cross-society comparisons and subsequent policy implications.

Keywords: Public goods experiment; Punishment; Cooperation; Culture (search for similar items in EconPapers)
JEL-codes: C91 C92 D81 J16 (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1007/s40881-023-00153-3

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