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A Breakdown of Cooperation in Public Goods Games

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  • Tanzir Rahman Khan
  • Bradley J. Ruffle

Abstract

We introduce a new variant of the Public Goods Game (PGG), building on and com bining the frameworks of Fischbacher et al. (2001) and Cheung (2014). We demonstrate that the widely used player categorizations based on players’ responses to others’ average contribution– such as conditional cooperators, free-riders, and hump-shaped cooperators– fail to fully capture players’ conditioning tendencies. Specifically, players are sensitive to the different distributions of contributions that can arise from a given mean, which leads to a re-categorization of players based on distributions compared to their categorization based solely on averages. Furthermore, we elicit beliefs about the most likely distribution of contributions underlying each mean. We find that providing incentives for correct guesses does not improve accuracy. Moreover, cooperators and free-riders hold widely divergent distributional beliefs.

Suggested Citation

  • Tanzir Rahman Khan & Bradley J. Ruffle, 2024. "A Breakdown of Cooperation in Public Goods Games," Department of Economics Working Papers 2024-12, McMaster University.
    • Handle: RePEc:mcm:deptwp:2024-12
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    References listed on IDEAS

    as
    1. Hartig, Björn & Irlenbusch, Bernd & Kölle, Felix, 2015. "Conditioning on what? Heterogeneous contributions and conditional cooperation," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 55(C), pages 48-64.
    2. Stephen Cheung, 2014. "New insights into conditional cooperation and punishment from a strategy method experiment," Experimental Economics, Springer;Economic Science Association, vol. 17(1), pages 129-153, March.
    3. Simon Gächter & Elke Renner, 2010. "The effects of (incentivized) belief elicitation in public goods experiments," Experimental Economics, Springer;Economic Science Association, vol. 13(3), pages 364-377, September.
    4. Fischbacher, Urs & Gachter, Simon & Fehr, Ernst, 2001. "Are people conditionally cooperative? Evidence from a public goods experiment," Economics Letters, Elsevier, vol. 71(3), pages 397-404, June.
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    7. Peter Katuščák & Tomáš Miklánek, 2023. "What drives conditional cooperation in public good games?," Experimental Economics, Springer;Economic Science Association, vol. 26(2), pages 435-467, April.
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    More about this item

    Keywords

    experimental economics; public goods game; conditional cooperation; belief elicitation;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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