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Coordinated selection of collective action: Wealthy-interest bias and inequality

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  • Corazzini, Luca
  • Cotton, Christopher S.
  • Longo, Enrico
  • Reggiani, Tommaso

Abstract

We extend a collective action problem to study policy and project selection by heterogeneous groups who prefer to work together on a joint initiative but may disagree on which initiative is best. Our framework, adapted from a model of multiple threshold public goods, presents groups with several mutually exclusive projects, any of which require sufficient support from the group to succeed. Individuals strictly prefer to contribute where and how much they believe others expect of them to ensure joint project success. Groups tend to coordinate on the public good preferred by the wealthiest member, demonstrating a wealthy-interest bias even without corruption, politics, and information asymmetries. At the same time, groups divide costs in highly progressive ways, with the wealthy voluntarily funding a disproportionate share, helping offset the inherent inequality from endowment and selection differences. We discuss applications for policy selection, charitable giving, and taxes.

Suggested Citation

  • Corazzini, Luca & Cotton, Christopher S. & Longo, Enrico & Reggiani, Tommaso, 2024. "Coordinated selection of collective action: Wealthy-interest bias and inequality," Journal of Public Economics, Elsevier, vol. 238(C).
  • Handle: RePEc:eee:pubeco:v:238:y:2024:i:c:s0047272724001087
    DOI: 10.1016/j.jpubeco.2024.105172
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    More about this item

    Keywords

    Multiple public goods; Donor heterogeneity; Crowdfunding; Lab experiment;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • H40 - Public Economics - - Publicly Provided Goods - - - General
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • L31 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Nonprofit Institutions; NGOs; Social Entrepreneurship

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