Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/207070 
Year of Publication: 
2019
Series/Report no.: 
Working Papers in Economics and Statistics No. 2019-04
Publisher: 
University of Innsbruck, Research Platform Empirical and Experimental Economics (eeecon), Innsbruck
Abstract: 
This study presents experimental results on the role that non-binding pledges have on the ability of resource users to manage the threat of probabilistic group damages in two separate environments. First, an environment where agents can work collectively to try to mitigate the root cause of the damage (mitigation), which is a form of public good. Second, an environment where in addition to collective mitigation, agents can work autonomously to protect themselves from the damages if they occur (adaptation). The tension is that mitigation and adaptation investments are strategic substitutes. We begin with a model that points to how non-binding pledges could be more effective in a world with both mitigation and adaptation strategies, compared to mitigation only. First-period results show that (i) consistent with previous literature, pledges in a mitigation-only envi- ronment do not increase average investments in collective mitigation, but (ii) when both mitigation and adaptation opportunities exist, pledges lead to higher investment in col- lective mitigation, lower investment in adaptation and increased efficiency. Although the average treatment effect disappears over time as the amount pledged decreases, pledges remain significant predictors of mitigation investments over the course of the experiment.
Subjects: 
social dilemmas
economic experiments
behavioral economics
public goods
mitigation
adaptation
environmental damages
JEL: 
D9
Q54
H4
C92
Document Type: 
Working Paper

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