Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/94305
Authors: 
Johnson, Lowell
Year of Publication: 
1997
Series/Report no.: 
Working Papers, Department of Economics, Rutgers, The State University of New Jersey 1996-18
Abstract: 
This paper extends theory and experimentation in the context of two parties in a group who contribute to a public good with a provision point. This study analyzes the voluntary contributions game in which a public good is provided if and only if the sum of contributions meets or exceeds a threshold. I analyze several Bayesian Nash equilibria in this game and examine their efficiency implications. In an experimental test of a public-goods problem with a threshold and rebate, the observed behavior of the subjects generally was consistent with a linear bidding strategy in which bids increased with realized valuation. Further, the behavior of some subjects was sensitive to changes in the prior distribution of valuations and the relative cost of the public good.
Subjects: 
Bayesian
Bayesian Nash equilibria
contribute
experiment
provision point
public
public good
public goods
threshold
voluntary contribution
voluntary contributions
JEL: 
H41
Document Type: 
Working Paper

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