TY - JOUR
T1 - See no evil
T2 - Information chains and reciprocity
AU - Steiger, Eva Maria
AU - Zultan, Ro'i
N1 - Funding Information:
Financial support from the Max Planck Society is gratefully acknowledged. We thank Johannes Abeler, Tim Cason, Robin Cubitt, Sven Fischer, Simon Gächter, Vittoria Levati, Daniele Nosenzo, Bradley Ruffle, Martin Sefton, Daniel Seidmann, Eyal Winter, two anonymous reviewers, and the participants at the Economics Science Association meetings in Copenhagen and Tucson for their helpful comments and discussion. We thank Karolin Schröter for programming the experiment and Inez Mureinik for editing services.
PY - 2014/1/1
Y1 - 2014/1/1
N2 - We study experimentally voluntary contributions to public goods when none, some, or all previous decisions are observable. When agents observe previous moves, they tend to condition their cooperation on observed cooperation. This leads to two effects of increased transparency: on the one hand, early movers are more likely to cooperate in order to encourage those who observe them to cooperate. On the other hand, as transparency increases, later movers are less likely to cooperate because they are more likely to observe defections and defect in response. With increasing returns to scale, where the effect of one agent's contribution is larger as more agents contribute, an information chain is as effective in inducing cooperation as full transparency. In a linear public good, where agents lose in monetary terms by contributing to the public good, information chains induce higher cooperation in early movers compared to a no-transparency treatment and in late movers compared to a full-transparency treatment. Thus, partial information can be used to balance the positive and negative effects of transparency.
AB - We study experimentally voluntary contributions to public goods when none, some, or all previous decisions are observable. When agents observe previous moves, they tend to condition their cooperation on observed cooperation. This leads to two effects of increased transparency: on the one hand, early movers are more likely to cooperate in order to encourage those who observe them to cooperate. On the other hand, as transparency increases, later movers are less likely to cooperate because they are more likely to observe defections and defect in response. With increasing returns to scale, where the effect of one agent's contribution is larger as more agents contribute, an information chain is as effective in inducing cooperation as full transparency. In a linear public good, where agents lose in monetary terms by contributing to the public good, information chains induce higher cooperation in early movers compared to a no-transparency treatment and in late movers compared to a full-transparency treatment. Thus, partial information can be used to balance the positive and negative effects of transparency.
KW - Conditional cooperation
KW - Externality
KW - Incentives
KW - Information
KW - Public goods
KW - Team production
KW - Transparency
UR - http://www.scopus.com/inward/record.url?scp=84888056109&partnerID=8YFLogxK
U2 - 10.1016/j.jpubeco.2013.10.006
DO - 10.1016/j.jpubeco.2013.10.006
M3 - Article
AN - SCOPUS:84888056109
SN - 0047-2727
VL - 109
SP - 1
EP - 12
JO - Journal of Public Economics
JF - Journal of Public Economics
ER -