Membership in citizen groups

Abstract

JEL classification: C73 D71We analyze the coordination problem of agents deciding to join a group that uses membership revenues to provide a discrete public good and excludable benefits. The public good and the benefits are jointly produced, so that benefits are valued only if the group succeeds in providing the public good. With asymmetric information about the cost of provision, the static membership game admits a unique equilibrium and we characterize the optimal membership fee. We show that heterogeneity in valuations for the excludable benefits is always detrimental to the group. However, in a dynamic contest in which heterogeneity arises endogenously (returning members receive additional seniority benefits at the expense of junior members), we show that, in the ex-ante optimal contract, offering seniority benefits is beneficial for the group, despite the heterogeneity in valuations created.

Incentives to Join Associations: The Case of Agritourism

“…This study captured a mix of farmers, farm and agritourism employees, and other agricultural stakeholders, which altogether shape the agritourism sector. Respondents reported joining their associations in pursuit of a suite of private and public incentives, confirming the extant literature (Barbieri & Mattozzi, 2009;Gazley & Dignam, 2010;Greenwood et al, 2002). Although respondents were satisfied with their association's offerings, especially in terms of communicating good and innovative business practices and fostering networking opportunities, they still have informational needs mainly related to their clientele and agricultural management.…”

“…Membership to associations can be viewed as a capital asset investment (Johnson, 1987) because individuals join and stay if the benefits (i.e., incentives) they receive outweighs the costs (Barbieri & Mattozzi, 2009). Thus, membership recruitment and retention is dependent on the extent to which the association fulfills members' motivations and the levels of satisfaction with the services provided (Bennett, 1998;Moon, 2000).…”

“…According to Bennett (1998), the Logic of Membership encompasses: (1) The logic of service, defined by the amenities associations offer to respond to members' individual requests and enquiries (i.e., private incentives); and (2) the logic of influence defined by the actions associations undertake on behalf of most of their members' interests (i.e., public incentives). Private incentives comprise economic (e.g., increase members' revenues), occupational (e.g., access to professional contacts), and informational (e.g., data services) benefits and foster social relational bonding by increasing members' recognition within a network or enabling networking opportunities (Barbieri & Mattozzi, 2009;Hager, 2014). Public incentives includes normative expectations (e.g., setting professional standards) and lobbying (e.g., informing policies) on behalf of the interests of a certain field or cause (Gazley & Dignam, 2010;Greenwood, Suddaby, & Hinings, 2002).…”

A Coordination Game Model of Charitable Giving and Seed Money Effect

“…SeeMorris and Shin (2003) for the details.22 Famous dynamic models of investments in projects includeAdmati and Perry (1991) andMarx and Matthews (2000). Dynamic models of investment in projects in the global game framework include, for example, Heidhues and Melissas(2006),Dasgupta (2007), andBarbieri and Mattozzi (2009).…”