Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/32240
Authors: 
Engel, Christoph
Rockenbach, Bettina
Year of Publication: 
2009
Series/Report no.: 
Preprints of the Max Planck Institute for Research on Collective Goods 2009,29
Abstract: 
Providing public goods is hard, because providers are best off free-riding. Is it even harder if one group's public good is a public bad for another group or, conversely, gives the latter a windfall profit? We experimentally study public goods provision embedded in a social context and find that in the absence of explicit norms externalities have almost no effect. With an endogenously formed provision norm positive as well as negative externalities dampen provision as compared to no externalities. We explain the surprisingly low provision under positive externalities by the providers' increased risk of inequity and stress the importance of institutions sustaining conditional cooperation.
Subjects: 
Public Good
Externality
Conditional Cooperation
Inequity Aversion
Norms
JEL: 
C91
D03
D43
D62
H23
H41
L13
Document Type: 
Working Paper

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