Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/100137
Authors: 
Kolle, Felix
Year of Publication: 
2012
Series/Report no.: 
CeDEx Discussion Paper Series 2012-07
Abstract: 
We experimentally investigate cooperation in privileged groups which according to Olson (1965) are groups in which at least one member has an incentive to supply a positive amount of the public good. More specifically, we analyze group member heterogeneity with respect to two dimensions: capability and valuation. Our results reveal that with and without punishment opportunities, heterogeneity crucially affects cooperation and coordination within groups. Compared to non-privileged groups, asymmetric valuations for the public good have negative effects, and asymmetric capabilities in providing the public good have positive effects on voluntary contributions. The main reason for these results are the different externalities contributions have on the other group members' payoffs affecting individuals' willingness to cooperate. Hence, whether heterogeneity facilitates or impedes collective action, and whether privileged groups are as privileged as they initially seem is subject to the nature of their asymmetry.
Subjects: 
public goods
heterogeneity
privileged groups
inequality
cooperation
punishment
JEL: 
H41
D63
C92
Document Type: 
Working Paper

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