Economic behavior often takes place in groups of small numbers of peopleinteracting with each other (like work teams, neighborhoods, socialnetworks, etc.). Characteristic of such interaction is the development of(affective) interpersonal relationships, or social ties. According tosociologists,...

Explaining the evolution and maintenance of cooperation among unrelated individuals is one of the fundamental problems in biology and the social sciences. Recent experimental evidence suggests that altruistic punishment is an important mechanism to maintain cooperation among humans. In this...

We propose a simple mechanism that might improve voluntary contributions to public goods. Using a laboratory experiment we analyze how bundling public with private goods affects individuals’ valuations for both goods. In the experiment, subjects may purchase a private and a public good either...

We report experimental evidence on the voluntary provision of public goods under threshold uncertainty. By explicitly comparing two prominent technologies, summation and weakest link, we show that uncertainty is particularly detrimental to threshold attainment under weakest link, where low...

The ability to punish free-riders can increase the provision of public goods. However, sometimes the benefit of increased public good provision is outweighed by the costs of punishments. One reason a group may punish to the point that net welfare is reduced is that punishment can express anger...

A growing experimental literature studies the endogenous choice of institutions to solve cooperation problems arising in prisoners' dilemmas, public goods games, and common pool resource games. Participants in these experiments have the opportunity to influence the rules of the game before they...

A growing experimental literature studies the endogenous choice of institutions to solve cooperation problems arising in prisoners' dilemmas, public goods games, and common pool resource games. Participants in these experiments have the opportunity to influence the rules of the game before they...

Sanctions are a common method to discourage free-riding in the provision of public goods. However, we can usually only sanction those who are detected performing the bad act of free-riding. There has been considerable research on the type of sanctions imposed, but this research almost always...

The ability to punish free-riders can increase the provision of public goods. However, sometimes, the benefit of increased public good provision is outweighed by the costs of punishments. One reason a group may punish to the point that net welfare is reduced is that punishment can express anger...

We use a laboratory experiment to identify the impact of risk in the private and public dimensions of social investments. In variants of a public good game, we separate the return a subject's investment generates for herself vs. the return to others. We find a detrimental effect of risk on...