Step-Level Public Goods: Experimental Evidence

Holger Rau () and Hans-Theo Normann

VfS Annual Conference 2011 (Frankfurt, Main): The Order of the World Economy - Lessons from the Crisis from Verein für Socialpolitik / German Economic Association

Abstract: We analyze the provision of a step-level public good in an experiment. Specifically, we investigate how the order of moves and the introduction of a second step-level affects public-good provision. We find that the sequential-move game improves public-good provision and payoffs. An additional step-level does lead to higher contributions but the effect on public-good provision is ambiguous and insignificant. Based on an existing data set, we calibrate Fehr and Schmidt's (1999) model of inequality aversion and find that actual behavior fits remarkably well with these predictions in a quantitative sense, but there are also two contradictions to the model's predictions.

Keywords: Experimental economics; sequential play; step-level public good (search for similar items in EconPapers)
JEL-codes: C92 D70 H41 (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:vfsc11:48710

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