Analysing group contract design using a threshold public goods experiment

Abstract

This paper presents the results of a threshold public goods game experiment with heterogeneous players. The experiment is designed in close collaboration with the Dutch association of agri-environmental farmer collectives. Subjects are recruited at a university (study 1) and a farm management training centre (study 2), the subjects of the second study most resembling the subjects in the field. The experiment consists of several treatments and each treatment has two different distribution rules, which are varied in a within-subjects manner. After subjects have experienced both, they can vote for one of the two rules: either a differentiated bonus that results in equal payoff for all, or an undifferentiated, equal share of the group bonus. In a between-subjects manner, subjects can vote for a (minimum or average) threshold or are faced with an exogenous threshold. The results indicate that exogenous thresholds perform better, possibly because the focal point they provide facilitates coordination. With regard to the two distribution rules, the results are mixed: in study 1, average contributions and payoffs are higher under the ‘equal-payoff’ rule, but there is no significant difference between the two in study 2. Overall, our results suggest that environmental payment schemes should consider cost heterogeneity in the design of group contracts, and pay explicit attention to coordination problems too.

Designing a professional request of the regional farming community for information-analytical, consulting and research services of agricultural education

“…A brief review of the publications revealed research trends that are relevant both for the Russian South with traditionally developed farming and for other regions of the world. Moreover, the general conclusion is the need for the development of farming to ensure the food security of countries, the preservation of rural populations and the development of rural areas, the introduction of new technological processes, institutional transformations, ensuring the quality of agricultural products, the environmental validity of managerial decisions in small-scale agricultural production [8,9,10,11].…”

Participatory research in times of COVID-19 and beyond: Adjusting your methodological toolkits

“…Public goods games are a commonly applied methodology to study cooperation in experimental economics (for a meta-analysis of lab studies, see Zelmer 36 ). There is a quickly growing literature on applying and co-designing public goods games with field populations, 37 also involving workshop formats. 38 In a standard linear contribution mechanism of public goods game experiment, n players receive an endowment e , which they must allocate to a private and public account.…”

Delegation and Overhead Aversion with Multiple Threshold Public Goods

“…Within this set up, CCV showed that increasing the number of public goods resulted in miscoordination among donors, lower contributions and a lower probability that any public good reached its contribution threshold. Several papers since have looked at extensions of CCV (Ansink, Koetse, Bouma, Hauck, & van Soest, 2017;Bouma, Nguyen, Van Der Heijden, & Dijk, 2020;Cason & Zubrickas, 2019). CCR extended CCV by introducing the possibility of coordinating contributions via an intermediary, varying whether the intermediary was obliged to send all transfers received from donors to the public goods as opposed to being allowed to expropriate any amount of these transfers for herself, and finding only that the former had a positive effect on public good success.…”