Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/174924
Authors: 
Cagala, Tobias
Glogowsky, Ulrich
Grimm, Veronika
Rincke, Johannes
Year of Publication: 
2017
Series/Report no.: 
CESifo Working Paper 6801
Abstract: 
This paper studies public goods provision in an experiment in which contributors repeatedly interact with rent-extracting administrators. Our main result is that the presence of an administrator reduces contributions but only because rent extraction lowers the MPCR. Analysing the dynamic interactions between the contributors and the administrator, we demonstrate that rent-extraction and cooperation shocks trigger short-run adjustments in the agents’ behaviour. However, shocks do not have permanent effects. This explains the long-run resilience of cooperation to rent extraction. We also show that cooperative attitudes and trust are traits that explain permanent differences in the short-run volatility of public goods provision.
Subjects: 
cooperation
rent extraction
corruption
trustworthiness
public goods
public trust game
panel vector autoregressive model
JEL: 
C32
C91
C92
H41
Document Type: 
Working Paper

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