Work

Coalitions Improve the Coordination and Provision of Public Goods: Theory and Experimental Evidence

Year: 2025

Type: article

Abstract: ABSTRACT We study a public goods game with heterogeneous agents who care about their own payoff as well as that of the player who receives the lowest payoff. The weight of own payoff varies across players and is private information. We first develop a theoretical model and then test the predictions of our model in a laboratory setting under different parameter conditions. In both our model and experiments, introducing a coalition formation stage before making a contribution decision enables sorting of players according to their preferences, resulting in higher contributions to the public good. Additionally, we find that participants in our experiment take previous period outcomes into account while making current period decisions. These results help explain successful coalitions, like International Environmental Agreements, that are effective in creating real‐world public goods like reductions in carbon emissions.

Source: Journal of Public Economic Theory

DOI: 10.1111/jpet.70037

Authors: Sheryl Ball, Sudipta Sarangi, Sakshi Upadhyay

Institutions: Virginia Tech, Skidmore College

Language: English

Topic: Experimental Behavioral Economics Studies

Subfield: Safety Research

Field: Social Sciences

Domain: Social Sciences

Open Access status: hybrid

Estimated APC paid: $3,350

Funders: National Science Foundation, Ecolab