Crossing the Point of No Return: A Public Goods Experiment

Urs Fischbacher, Werner Güth () and Maria Levati

No 2011-059, Jena Economics Research Papers from Friedrich-Schiller-University Jena

Abstract: Participants in a public goods experiment receive private or common signals regarding the so-called "point of no return", meaning that if the group's total contribution falls below this point, all payoffs are reduced. An individual faces the usual conflict between private and collective interests above the point of no return, while he incurs the risk of damaging everyone by not surpassing the point. Our data reveal that contributions are higher if the cost of not reaching the threshold is high. In particular if the signal is private, many subjects are not willing to provide the necessary contribution.

Keywords: Public goods; provision point mechanism; experiments; reduction factor; signal (search for similar items in EconPapers)
JEL-codes: C72 C92 H41 (search for similar items in EconPapers)
Date: 2011-12-16
New Economics Papers: this item is included in nep-cbe, nep-cta, nep-exp and nep-gth
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Related works:
Working Paper: Crossing the Point of No Return: A Public Goods Experiment (2011)
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