Relative performance of two simple incentive mechanisms in a public good experiment

Juergen Bracht (), Charles Figuieres and Marisa Ratto ()

The Centre for Market and Public Organisation from The Centre for Market and Public Organisation, University of Bristol, UK

Abstract: This paper reports on experiments designed to compare the performance of two incentive mechanisms in public goods problems. One mechanism rewards and penalizes deviations from the average contribution of the other agents to the public good (tax-subsidy mechanism). Another mechanism allows agents to subsidize the other agents’contributions (compensation mechanism). It is found that both mechanisms lead to an increase in the level of contribution to the public good. The tax-subsidy mechanism allows for good point and interval prediction of the average level of contribution. The compensation mechanism allows for less reliable prediction of the average level of contributions.

Keywords: public goods; voluntary provision; incentive mechanisms (search for similar items in EconPapers)
JEL-codes: D62 H42 (search for similar items in EconPapers)
Pages: 42 pages
Date: 2004-05
New Economics Papers: this item is included in nep-exp and nep-reg
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Relative performance of two simple incentive mechanisms in a public goods experiment (2008)
Working Paper: Relative performance of two simple incentive mechanisms in a public goods experiment (2008)
Working Paper: Relative performance of two simple incentive mechanisms in a public good experiment (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:bri:cmpowp:04/102

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