Bergstrom, Blume and Varian (1986) provides an elegant gametheoretic model of an economy with one private good and one public good. Strategies of players consist of voluntary contributions of the private good to public good production. Without relying on first order conditions, the authors...

Sanctioning increases cooperation in public goods games, but not indiscriminately under all conditions and in all societies, and the mechanisms by which sanctioning exercises its impact on behavior are yet to be studied in detail. We show experimentally that in the presence of sanctioning, our...

Bergstrom, Blume and Varian (1986) provides an elegant gametheoretic model of an economy with one private good and one public good. Strategies of players consist of voluntary contributions of the private good to public good production. Without relying on first order conditions, the authors...

Bergstrom, Blume and Varian (1986) provides an elegant gametheoretic model of an economy with one private good and one public good. Strategies of players consist of voluntary contributions of the private good to public good production. Without relying on first order conditions, the authors...

We revisit the classical result that taxation of private consumption is distortionary and therefore precludes the efficient provision of public goods. We introduce a nonlinear consumption tax which we call a ‘tax lottery’. Under this scheme, an ad-valorem consumption tax is supplemented with...

Evolutionary game theory has shown that in environments characterised by a social-dilemma situation punishment may be an adaptive behaviour. Experimental evidence closely corresponds to this finding but yields contradictory results on the cooperation-enhancing effect of punishment if players are...

This paper presents a formal theory of reciprocity. Reciprocity means that people reward kind actions and punish unkind ones. The theory takes into account that people evaluate the kindness of an action not only by its consequences but also by the intention underlying this action. The theory...

In this paper we show that a simple model of fairness preferences explains major experimental regularities of common pool resource (CPR) experiments. The evidence indicates that in standard CPR games without communication and without sanctioning possibilities inefficient excess appropriation is...

This paper concerns multistage games, with and without discounting, in which each player can increase the level of an action over time so as to increase the other players' future payoffs. An action profile is said to be achievable if it is the limit point of a subgame perfect equilibrium path....

We use a simple balanced budget contest to collect taxes on a private good in order to finance a pure public good. We show that-with an appropriately chosen structure of winning probabilities-this contest can provide the public good efficiently and without distorting private consumption. We...