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Experience and history: An experimental approach to generational heterogeneity

Author

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  • Marianna Baggio
  • Luigi Mittone
Abstract
The development and use of long-lived public goods involves more than one demographic generation, leaving the classic literature on voluntary provisions partially unfit to explain complex phenomena such as welfare systems, climate policies and major infrastructure projects. This paper proposes a model that explains how equilibrium is reached in a context where heterogeneity is linked to seniority and strategic interaction is finitely repeated. Within this model the case of financial aid schemes for economic development is explained using a redistribution rule that benefits the younger players, as a compensation for their inexperience. Experimental evidence shows that subjects who belong to low or middling marginal per capita return types are negatively affected by heterogeneity, whereas groups benefit from the presence of experienced subjects.

Suggested Citation

  • Marianna Baggio & Luigi Mittone, 2014. "Experience and history: An experimental approach to generational heterogeneity," CEEL Working Papers 1404, Cognitive and Experimental Economics Laboratory, Department of Economics, University of Trento, Italia.
    • Handle: RePEc:trn:utwpce:1404
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    1. Kreitmair, Ursula & Bower-Bir, Jacob, 2021. "Too different to solve climate change? Experimental evidence on the effects of production and benefit heterogeneity on collective action," Ecological Economics, Elsevier, vol. 184(C).

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