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Estimating private provision of public goods with heterogenous participants: a structural analysis

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  • Yonghong An
  • Yingyao Hu
  • Pengfei Liu

Abstract

This paper estimates a structural model of private provision of public goods to provide some new empirical evidence on individuals' strategic contributing behaviors. In the model, individuals' contributing behaviors are allowed to be heterogenous and time-varying. We show that all the main components of the model including the number of different contributing strategies, functional form for each strategy, and how individuals adjust their strategies are identified from the revealed contribution choices of individuals. Further, the structural model is estimated using the data collected in a threshold public good experiment. The empirical results suggest that subjects in our experiment employ three contributing strategies, and they strategically respond to provision history by adjusting their preceding behavior. In addition, the response is heterogenous and dependent on subjects' contributing strategies.

Suggested Citation

  • Yonghong An & Yingyao Hu & Pengfei Liu, 2015. "Estimating private provision of public goods with heterogenous participants: a structural analysis," CeMMAP working papers 18/15, Institute for Fiscal Studies.
    • Handle: RePEc:azt:cemmap:18/15
    DOI: 10.1920/wp.cem.2015.1815
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    Cited by:

    1. An, Yonghong, 2017. "Identification of first-price auctions with non-equilibrium beliefs: A measurement error approach," Journal of Econometrics, Elsevier, vol. 200(2), pages 326-343.

    More about this item

    JEL classification:

    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General

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