Motivate the crowd or crowd- them out? The impact of local government spending on the voluntary provision of a green public good

Lara Bartels and Martin Kesternich

No 22-040, ZEW Discussion Papers from ZEW - Leibniz Centre for European Economic Research

Abstract: Cities are increasingly hold accountable for climate action. By demonstrating their proenvironmentality through own climate-related activities, they not at least aspire to encourage individual climate protection efforts. Based on standard economic theory there is little reason to assume that this is a promising strategy. Financed by taxpayers' money, cities' contributions are considered as substitutes that crowd-out private contributions to the same public good. Inspired by research on providing information on reference group behavior, we challenge this argument and conduct a framed-field experiment to analyze the impact of reference group information on the voluntary provision of a green public good. We investigate whether information on previous contributions by fellow citizens or the city affect individual contributions. We do not find statistical evidence that city-level information crowds-out additional individual contributions. A reference to fellow citizens significantly increases the share of contributors as it attracts subjects that are not per-se pro-environmentally oriented.

Keywords: Voluntary provision of environmental public goods; Social Norms; Crowding-out; Willingness to pay; Framed-field experiment (search for similar items in EconPapers)
JEL-codes: C83 C93 D9 H41 Q54 (search for similar items in EconPapers)
Date: 2022
New Economics Papers: this item is included in nep-ene, nep-env, nep-exp, nep-hme and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Working Paper: Motivate the crowd or crowd-them out? The impact of local government spending on the voluntary provision of a green public good (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:zewdip:22040

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