We consider a model of a single defendant and N plaintiffs where the total cost of litigation is fixed on the part of the plaintiffs and shared among the members of a suing coalition. By settling and dropping out of the coalition, a plaintiff therefore creates a negative externality on the other...

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...

We consider a model of a single defendant and N plaintiffs where the total cost of litigation is fixed on the part of the plaintiffs and shared among the members of a suing coalition. By settling and dropping out of the coalition, a plaintiff therefore creates a negative externality on the other...

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...

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 achievable if it is the limit point of a subgame perfect equilibrium path. Necessary...

We report the results of a laboratory experiment on crowd-out in a voluntary contribution mechanism public good game. In our setting, a standard argument states that a tax should not be effective in raising contributions, because agents respond by reducing voluntary contributions by the amount...

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 a...

This paper studies a class of dynamic voluntary contribution games in a setting with discounting and neoclassical payoffs (differentiable, strictly concave in the public good, and quasilinear in the private good). An achievable profile is the limit point of a subgame perfect equilibrium path --...

This paper examines the role of status acquisition as a motive for giving in voluntary contributions to public goods. In particular, every donor's status is given by the difference between his contribution and that of the other donor. Specifically, I show that contributors give more than in...