Institution Formation in Public Goods Games

Exposing an overlooked ambiguity in how philosophers use the term ‘public good,’ this paper proposes to distinguish between inherently and contingently public goods, where inherently public goods are non-rivalrous and non-excludable in principle (e.g., national security) and contingently public goods are non-rivalrous and deliberately provided in a non-exclusionary way (e.g., parks). This distinction is conducive to philosophical debate in two ways. At the level of ideal theory, contingently public goods reveal the inadequacy of the various benefit principles that have been proposed to ensure justice in the provision of public goods (Claassen 2013; Miller and Taylor 2018; Murphy and Nagel 2001). Because these goods could be provided as club goods, benefit principles mandate unacceptable transfer payments to the privately wealthy and to people who disvalue their inclusive mode of provision. At the level of non-ideal theory, contingently public goods constitute a natural yet underappreciated focal point for effectively rectifying injustices. While all public goods promise to render access to private resources less relevant, contingently public goods hold special potential: their provision may be costless and involve no market interference, it can more powerfully express a commitment to status equality and it can be especially effective at addressing inequalities in opportunity.

The impact of lotteries on cooperation in the public goods game

It is well documented that people are reluctant to switch from a default option. We experimentally test the robustness of this behavioral inertia in a collective decision-making setting by varying the default option type and the decision-making environment. We examine the impacts of automatic-participation and no-participation default options on subjects’ participation in a public goods provision and their contributions. Two variants of public goods game are employed: the linear and the threshold public goods games. The study shows the evidence of partial stickiness rather than complete stickiness of default options as indicated in empirical studies. Our experimental results square with the evidence of behavioral inertia only when the automatic-participation default is used. This default boosts contributions in the linear public goods game but not in the threshold public goods game. The evidence of partial stickiness is robust to the variation of the game employed, but the effect on contribution is sensitive to it.

This paper replicates four highly cited, classic lab experimental studies in the provision of public goods. The studies consider the impact of marginal per capita return and group size; framing (as donating to or taking from the public good); the role of confusion in the public goods game; and the effectiveness of peer punishment. Considerable attention has focused recently on the problem of publication bias, selective reporting, and the importance of research transparency in social sciences. Replication is at the core of any scientific process and replication studies offer an opportunity to reevaluate, confirm or falsify previous findings. This paper illustrates the value of replication in experimental economics. The experiments were conducted as class projects for a PhD course in experimental economics, and follow exact instructions from the original studies and current standard protocols for lab experiments in economics. Most results show the same pattern as the original studies, but in all cases with smaller treatment effects and lower statistical significance, sometimes falling below accepted levels of significance. In addition, we document a “Texas effect,” with subjects consistently exhibiting higher levels of contributions and lower free-riding than in the original studies. This research offers new evidence on the attenuation effect in replications, well documented in other disciplines and from which experimental economics is not immune. It also opens the discussion over the influence of unobserved heterogeneity in institutional environments and subject pools that can affect lab results.

Emotion helps people hide from traitors and follow partners. It greatly affects the actual migration in a public goods game (PGG). How this factor affect the migration and the corresponding cooperation level has still not been investigated yet. An emotional migration in a PGG on continuous two-dimensional space was investigated. An emotional index was proposed to describe the different attitude of a player to his different neighbors. An emotional migration model was proposed by defining a weight function that a cooperator goes with a neighbor who makes him happier and gets away from a neighbor who makes him angry. Results show that the emotional migration mechanism acts as a double-edged sword, with its effects intricately intertwined with migratory velocity and interaction radius. When both migratory velocity and interaction radius are low, stable emotional communication gradually solidifies the foundation of trust. This process motivates individuals to actively engage in public goods provision, fostering a virtuous cycle of win-win cooperation. Conversely, when migratory velocity surges and the interaction scope expands exponentially, excessive emotional migration disrupts the trust equilibrium, undermines resource allocation order, and renders cooperative strategies unsustainable. Ultimately, this leads to the collapse of the entire cooperative system.

When clients vote for brokers: How elections improve public goods provision in urban slums

Sustaining cooperation in social dilemmas is a fundamental objective in the social and biological sciences. Although providing a punishment option to community members in the public goods game (PGG) has been shown to effectively promote cooperation, this has some serious disadvantages; these include destruction of a society's physical resources as well as its overall social capital. A more efficient approach may be to instead employ a reward mechanism. We propose an endogenous reward mechanism that taxes the gross income of each round's PGG play and assigns the amount to a fund; each player then decides how to distribute his or her share of the fund as rewards to other members of the community. Our mechanism successfully reverses the decay trend and achieves a high level of contribution with budget-balanced rewards that require no external funding, an important condition for practical implementation. Simulations based on type-specific estimations indicate that the payoff-based conditional cooperation model explains the observed treatment effects well.

Cooperation limitations under a one-time threat of expulsion and punishment

The provision of more and better public goods is part of the Chinese efforts to emphasize the quality rather than the quantity of economic growth. Provision of public goods such as education, public health, elderly care, environmental preservation, protection, and restoration, basic research, infrastructure, social safety net, and alleviation of poverty has been vastly expanded in China since the establishment of the People’s Republic of China in 1949, with significant positive results in all these areas. The provision of public goods has also raised the potential GDP of the Chinese economy through its effects on increasing the aggregate demand for investment and consumption, the productivity of the labor force, and the rate of return on other fixed-asset investments. Public goods are by their very nature mostly “local”, and their provision is consistent with the Chinese “dual-circulation development strategy” with primary focus on domestic circulation. The provision of public goods also constitutes a form of redistribution in kind, e.g., clean air and water, which can be enjoyed by everyone, and hence also directly advances the goal of ”common prosperity”. Despite significant increase in the degree of income inequality in China since the mid-1980s, the welfare of all Chinese people has improved significantly. However, the provision of public goods frequently results in negative value-added at market prices, and therefore reduces, rather than enhances, the rate of growth of measured GDP. Finally, increasing the provision of public goods can be a significant source of growth of the domestic aggregate demand for both consumption and investment, over and above what increases in household income alone are able to provide. Maintaining an adequate growth of aggregate demand is essential for continued Chinese economic prosperity.

It is often difficult to distinguish dominance from leadership in international economic relations. The latter concept, however, rejects exploitation and implies an often critical function in the provision of public goods. In its absence, the provision of such public goods as a market for distress goods, a steady flow of capital, and a rediscount mechanism may disappear. This stabilization function was provided by the United States in the first postwar decades, but the U.S. now has neither the will nor the international acceptance to play such a role. And a successor is not in sight.

Nudging cooperation in public goods provision

The linear or threshold Public Goods game (PGG) is extensively accepted as a paradigmatic model to approach the evolution of cooperation in social dilemmas. Here we explore the significant effect of nonlinearity of the structures of public goods on the evolution of cooperation within the well-mixed population by adopting Darwinian dynamics, which simultaneously consider the evolution of populations and strategies on a continuous adaptive landscape, and extend the concept of evolutionarily stable strategy (ESS) as a coalition of strategies that is both convergent-stable and resistant to invasion. Results show (i) that in the linear PGG contributing nothing is an ESS, which contradicts experimental data, (ii) that in the threshold PGG contributing the threshold value is a fragile ESS, which cannot resist the invasion of contributing nothing, and (iii) that there exists a robust ESS of contributing more than half in the sigmoid PGG if the return rate is relatively high. This work reveals the significant effect of the nonlinearity of the structures of public goods on the evolution of cooperation, and suggests that, compared with the linear or threshold PGG, the sigmoid PGG might be a more proper model for the evolution of cooperation within the well-mixed population.

Public goods, ranging from judiciary to sanitation to parkland, permeate daily life. They have been a subject of intense interdisciplinary study, with a traditional focus being on participation levels in isolated public goods games (PGGs) as opposed to a more recent focus on participation in PGGs embedded into complex social networks. We merged the two perspectives by arranging voluntary participants into one of three network configurations, upon which volunteers played a number of iterated PGGs within their network neighborhood. The purpose was to test whether the topology of social networks or a freedom to express preferences for some local public goods over others affect participation. The results show that changes in social networks are of little consequence, yet volunteers significantly increase participation when they freely express preferences. Surprisingly, the increase in participation happens from the very beginning of the game experiment, before any information about how others play can be gathered. Such information does get used later in the game as volunteers seek to correlate contributions with higher returns, thus adding significant value to public goods overall. These results are ascribable to a small number of behavioral phenotypes, and suggest that societies may be better off with bottom-up schemes for public goods provision.

In a public goods game, while cooperators need to make contributions, defectors can take a free ride after the realization of the public good. The Nash equilibrium in this game is simply zero contribution from all the players. A conventional approach to encourage cooperation and achieve the public good is using rewards to compensate the difference between the cooperators’ and the defectors’ payoffs. However, the public good may not be realized due to the uncertainty in the game, and the conventional way could underestimate the required rewards to achieve the public good. On the other hand, public good did realize in human history when people cannot survive from a natural disaster, such as a big flood, without cooperating to build a solid embankment, and most of them are willing to choose cooperation without rewards. The realization of the public good leads to the reduction of the defection cost and the contribution, which has a potential to encourage the players’ cooperation. Then the conventional method may overestimate the necessary rewards to realize the public good. In this paper, a public goods game is employed to model the interaction among boundedly rational players with the rewards for large-scale cooperation, and a behavioral game-theoretic approach is developed to describe their decision making processes with the consideration of the risk and impact of public good in the game. It turns out that the conventional rewards to achieve the large-scale cooperation can be reduced for a favorable group of the players.

1. Introduction Multifunctionality of agriculture is already noticed in the past and the scale of its occurrence is characterized by the utilization of labour resources and physical capital on farms and the scale of non-agricultural employment. In the Polish scientific literature there is a discussion of the multifunctionality of the country and the rural areas (multifunctionality of rural areas), which consists of rural economic diversification and thus increasing employment opportunities in non-agricultural activities in rural areas (Wilkin, 2008). According to the definition of pure public goods which are delivered to all citizens in the area without being able to exclude anyone from consumption and the marginal cost of supplying those goods is zero. In terms of tourist visiting the region of agro-tourism services can be a public good or club, depending on whether it is possible to exclude anyone from consumption. They can also be good in a club or private, depending on whether these goods are competitive. From the perspective of the inhabitants of the region carry out the tasks of a municipality within the rural tourism can be regarded as providing a pure public good. The premise of the present paper is the multifunctional development of the current issues of agriculture which is to include reinforcing elements increasing rural tourism values by enriching the attractiveness of the landscape and tourism development. Noticeable is the lack of definition in the literature that treated rural tourism as a public good provided by local or central government. Under the law the task of municipalities is to conduct and financing of tourism policy. Selection of paper topic and related issues has been conditioned by the need to supplement, to systematize and update knowledge of the relevant aspects and conditions for development of multifunctional agriculture (especially tourism), taking into an account the characteristics of natural, social and economic environment for local and regional levels. Against the background of the study there will be attempt to answer the following questions: * Whether the provision of public goods by agro tourism affects its profitability? * Whether agro-tourism services have an impact on the profitability of farms or if only by a purely market-based revenues, or through transfers from public funds? The development of tourism in rural areas is possible. More than half of rural communities meet the criteria for recreational space and has favourable conditions for development of tourism. However, it is noted that there are significant barriers concerning human capital. They influence the decision to be taken in shaping changes in rural areas and do not allow full use of the existing possibilities. 2. Material and research methods The research on the evaluation of agro tourism as a public good was carried out in the Western Pomerania communities. The questionnaire method was used to collect data. The source materials on the opinion of owners of agro tourism farms were the result of research carried out in 2011. The research involved 40 farm owners. In order to identify following questions: (a) whether the provision of public goods by agro tourism affects its profitability? (b) whether agro tourism services have an impact on the profitability of farms or if only by a purely market-based revenues, or through transfers from public funds? The [chi square] test of independence, which allows to determine the statistical significance of the relationship between both measurable and non-measurable variables, was used. The test involves comparing the number of responses received in a number of researches that can be expected under the assumption that there are no relationships between the analysed variables. The values of [chi square] and degrees of freedom (df) are working and are generally not assessed. The interpretation covers primarily the level of probability (p), on the basis of which the existence or lack of dependence are predicated. …