Cooperation in Partnerships: The Role of Breakups and Reputation

Ralph-C Bayer ()

No 2011-22, School of Economics and Public Policy Working Papers from University of Adelaide, School of Economics and Public Policy

Abstract: We investigate experimentally if endogenous partnership formation can improve efficiency in social dilemma situations. Subjects play multiple two-player public goods games, where they can break up with their current partner after every fourth game. Subjects without a partner provide rankings of the available other singles regarding their preferred subject to be matched with. A stable marriage mechanism determines the new matches. We vary the information subjects have when they express their preferences for their future matches and also if staying in a partnership leads to a cost or a bonus. We find that endogenous group formation can increase efficiency. Both the provision of contribution history at the time of re-matching and bonuses for staying in a partnership have positive effects. At least one of the two positive factors has to be present for an efficiency improvement. The presence of both leads to the best results.

Keywords: Social Dilemma; Endogenous Group Formation; Public Goods (search for similar items in EconPapers)
JEL-codes: D03 D83 H41 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2011-04
New Economics Papers: this item is included in nep-cbe, nep-exp, nep-gth and nep-soc
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Citations: View citations in EconPapers (5)

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Related works:
Journal Article: Cooperation in Partnerships: The Role of Breakups and Reputation (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:adl:wpaper:2011-22

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