An Experimental Investigation of Electoral Delegation and the Provision of Public Goods

Abstract

How effectively do democratic institutions provide public goods? Despite the incentives an elected leader has to free ride or impose majority tyranny, our experiment demonstrates that electoral delegation results in full provision of the public good. Analysis of the experimental data suggests that the result is primarily due to electoral selection: groups elect prosocial leaders and replace those who do not implement full contribution outcomes. However, we also observe outcomes in which a minimum winning coalition exploits the contributions of the remaining players. A second experiment demonstrates that when electoral delegation must be endogenously implemented, individuals voluntarily cede authority to an elected agent only when preplay communication is permitted. Our combined results demonstrate that democratic delegation helps groups overcome the free-rider problem and generally leads to outcomes that are often both efficient and equitable.

The Impact of Recentralization on Public Services: A Difference-in-Differences Analysis of the Abolition of Elected Councils in Vietnam

“…Lab experiments by Walker et al (2000) and Kroll et al (2007) provide suggestive evidence for the link between direct democracy and efficient public good provision under ideal conditions. Furthermore, Hamman et al (2011) find that democratic delegation helps lab subjects avoid the free-rider problem and frequently achieve more efficient and equitable social outcomes. Similar results are also found in psychology experiments (e.g., Wilke et al 1986) As Wibbels (2006) notes, however, work in political economy has laid bare the underlying assumptions of decentralization theories (Weingast 1995) and in many cases has demonstrated that they are not met.…”

Information-sensitive Leviathans

“…6 For the effect of democratically appointed leaders see also Hamman, Weber, andWoon (2011), Corazzini, Kube, Maréchal, andNicolò (2014).…”

The Social Preferences of Democratically Elected Decision Makers and the Conflict between Wealth Generation and Distribution

“…Voters have been shown to use retrospective voting rules (Woon, 2012), so that a concern with re-election gives an incentive for leaders to behave well (Dasgupta, 2009). Voters have also been shown to select more pro-social leaders (Hamman et al, 2011). Other experiments underline another behavioral effect of democracy, which is due to aversion for lying:…”

“…(Eichenberger & Oberholzer-Gee, 1998). Similarly, Grimalda et al (2008) state that "'institutions' allowing more participation in the process of collective choice lead to more 'socially responsible' behavior in the players" and Hamman et al (2011) state that "democratic delegation helps groups overcome the free-rider problem and generally leads to outcomes that are often both efficient and equitable." Hypothesis 2.…”