A1 Refereed original research article in a scientific journal

Cooperation and strategic complementarity: An experiment with two voluntary contribution mechanism games with interior equilibria




AuthorsOlli Lappalainen

PublisherMDPI AG

Publication year2018

JournalGames

Journal name in sourceGames

Volume9

Issue3

ISSN2073-4336

eISSN2073-4336

DOIhttps://doi.org/10.3390/g9030045

Web address http://www.mdpi.com/2073-4336/9/3/45

Self-archived copy’s web addresshttps://research.utu.fi/converis/portal/detail/Publication/35728870


Abstract

In public goods game experiments, designs implementing non-linearities in the production are less common than the standard linear setting, especially so under the assumption that the private goods production and public goods aggregation function are both non-linear. We study a voluntary contribution game (VCM) in which returns from the private project have diminishing marginal benefits and the contributions to the joint project exhibit pairwise strategic complementarities. As a control, we use a public goods game with an identical private production technology, but with the standard linear public goods aggregation. In addition to the aggregation technology, we manipulate the group size variable: In both treatments, the subjects will first play a VCM game in groups of five for 20 rounds, after which the group size is reduced to two, and the game is played for another 20 rounds. A significant over-contribution is observed in both settings when the group size is five. The rate of over-contribution is much higher under the complementary technology, but as predicted by theory, the contributions drop drastically when the group size is reduced from n = 5 to n = 2 within this treatment. Our experiment also provides empirical evidence that the so-called group size effect is present in both treatments, but it is much weaker under the standard aggregation technology.                                                                                                                      -


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