EconPapers    
Economics at your fingertips  
 

Why pay for nothing? An experiment on a conditional subsidy scheme in a threshold public good game

Philippe Le Coent, Sophie Thoyer () and Raphaële Préget ()

Post-Print from HAL

Abstract: The voluntary provision of public goods can be boosted by subsidies paid to contributors. This paper compares the performance of two types of subsidy schemes in a threshold public game: an unconditional subsidy paid to each contributor proportionally to his contribution; and a conditional subsidy paid to each contributor only if the public good threshold is attained. Our experimental results show that subsidy schemes are not only effective but also efficient to improve the provision of threshold public goods. In addition, introducing a conditional payment improves the efficiency of the mechanism and in some cases improves its effectiveness, despite identical game-theoretic predictions. By drawing an analogy between agri-environmental contracts and subsidy schemes in threshold public goods, these results suggest that the performance of environmental contracts (such as agri-environmental schemes) could be improved in the case of threshold effects of pollution on the environment by introducing a collective conditionality on contract payments.

Date: 2014-09-11
Note: View the original document on HAL open archive server: https://hal.inrae.fr/hal-02739425v1
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Published in 1. Conférence annuelle de la FAERE, French Association of Environmental and Resource Economists (FAERE). Paris, FRA., Sep 2014, Montpellier, France. 13 p

Downloads: (external link)
https://hal.inrae.fr/hal-02739425v1/document (application/pdf)

Related works:
Journal Article: Why pay for nothing? An experiment on a conditional subsidy scheme in a threshold public good game (2014) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-02739425

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().

 
Page updated 2025-03-19
Handle: RePEc:hal:journl:hal-02739425