Abstract
A discrete public good is provided when total contributions equal or exceed the contribution threshold. Recent theoretical work shows that an increase in threshold uncertainty will increase (decrease) equilibrium contributions when the public good value is sufficiently high (low). In an experiment designed to test these predictions, I find only limited verification of the prediction. Using elicited beliefs data to represent subjects’ beliefs, I find that behavior is not consistent with expected payoff maximization, however, contributions are increasing in subjects’ subjective pivotalness. Thus, wider threshold uncertainty will sometimes—but not always—hinder collective action.
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Helpful comments were received from Stephen Morris, Ben Polak, David Pearce, Hongbin Cai, Andrew Schotter, Thomas Palfrey, Charles Plott, Dirk Bergemann, Leatt Yariv, Chris Udry, Pushkar Maitra, seminar participants at Yale University’s game theory group, UCSB third-year seminar, BYU, UC Irvine, Ohio State, Stanford Graduate School of Business, participants at the 2004 Public Choice Society / Economic Science Association Meetings, and anonymous referees. Financial support was received from the Institution for Social and Policy Studies at Yale University, the California Social Science Experimental Laboratory (CASSEL) at UCLA, and the University of California, Irvine. Special thanks to the Social Science Experimental Laboratory at the California Institute of Technology and CASSEL for use of laboratory resources and to Yolanda Huang for programming assistance.
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Open Access This is an open access article distributed under the terms of the Creative Commons Attribution Noncommercial License (https://creativecommons.org/licenses/by-nc/2.0), which permits any noncommercial use, distribution, and reproduction in any medium, provided the original author(s) and source are credited.
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McBride, M. Threshold uncertainty in discrete public good games: an experimental study. Econ Gov 11, 77–99 (2010). https://doi.org/10.1007/s10101-009-0069-8
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DOI: https://doi.org/10.1007/s10101-009-0069-8