Exploring Group Cooperation in the Provision of Public Goods

Abstract

A novel version of a Voluntary Contribution Mechanism game tests how player cooperation responds to changes in incentives, i.e., payoffs that depend on performance relative to different reference groups. Cooperation is greatest when players are competing against players in other four-person groups, intermediate when competition is diffused, and lowest when players compete in a zero-sum game within their own group. Zirogiannis for their comments on drafts of this paper as well as two very helpful referees and the editors for their generous attention. All remaining mistakes are mine.