Delegation and coordination with multiple threshold public goods: experimental evidence
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Delegation and coordination with multiple threshold public goods: experimental evidence Luca Corazzini1 · Christopher Cotton2 · Tommaso Reggiani3,4 Received: 13 March 2019 / Revised: 3 December 2019 / Accepted: 7 December 2019 © Economic Science Association 2019
Abstract When multiple charities, social programs and community projects simultaneously vie for funding, donors risk mis-coordinating their contributions leading to an inefficient distribution of funding across projects. Community chests and other intermediary organizations facilitate coordination among donors and reduce such risks. To study this, we extend a threshold public goods framework to allow donors to contribute through an intermediary rather than directly to the public goods. Through a series of experiments, we show that the presence of an intermediary increases public good success and subjects’ earnings only when the intermediary is formally committed to direct donations to socially beneficial goods. Without such a restriction, the presence of an intermediary has a negative impact, complicating the donation environment, decreasing contributions and public good success. Keywords Delegation · Threshold public goods · Laboratory experiment · Fundraising
We thank Diya Elizabeth Abraham, Federica Alberti, Eliane Barker, Pietro Dindo, Milos Fisar, Ben Greiner, Wolfgang Luhan, Valeria Maggian, Thomas Markussen, Louis Putterman, Rainer Michael Rilke, Christian Thöni, Serena Trucchi, Kei Tsutsui, Ansgar Wohlschlegel, participants at the Workshop on Endogenous Institutions in Social Dilemmas in Copenhagen, the ESA World Meeting in Berlin, and seminars in Venice and Portsmouth, for useful discussions and comments. We are especially grateful to Joachim Vosgerau for giving us the opportunity to run the experiment at the Bocconi Experimental Laboratory for the Social Sciences (BELSS, Bocconi University, Milan). Iuliana Iuras provided excellent research assistance during our experimental sessions at BELSS. Cotton is grateful for financial support provided through his position as the Jarislowsky– Deutsch Chair in Economic and Financial Policy at Queen’s University and the Social Sciences and Humanities Research Council of Canada (435-2017-0573). Reggiani is grateful for financial support from the Czech Science Foundation (GACR: GA18-19492S). All errors are ours. Electronic supplementary material The online version of this article (https://doi.org/10.1007/s1068 3-019-09639-6) contains supplementary material, which is available to authorized users. * Tommaso Reggiani [email protected] Extended author information available on the last page of the article
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JEL Classification C91 · C92 · H40 · H41 · L31
1 Introduction In threshold public good games, players choose how much (money, time or effort) to contribute towards a public good that will provide benefits only if total contributions exceed a minimum level. Such games can be used to model strategic contribution decisions involving crowdfunding
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