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Income Inequality, Reciprocity and Public Good Provision: An Experimental Analysis

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Listed:
  • Andre Hofmeyr
  • Justine Burns

    (School of Economics, University of Cape Town)

  • Martine Visser

    (School of Economics, University of Cape Town)

Abstract

This paper analyses the impact of income inequality on public good provision in an experimental setting. A sample of secondary school students were recruited to participate in a simple linear public goods game where income heterogeneity was introduced by providing participants with unequal token endowments. The results show that endowment heterogeneity does not have any significant impact on contributions to the public good, and that consistent with models of reciprocity, low and high endowment players contribute the same fraction of their endowment to the public pool. Moreover, individuals appear to adjust their contributions in order to maintain a fair share rule.

Suggested Citation

  • Andre Hofmeyr & Justine Burns & Martine Visser, 2008. "Income Inequality, Reciprocity and Public Good Provision: An Experimental Analysis," SALDRU Working Papers 23, Southern Africa Labour and Development Research Unit, University of Cape Town.
    • Handle: RePEc:ldr:wpaper:23
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    References listed on IDEAS

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