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An Experimental Investigation of Excludable Public Goods

Published online by Cambridge University Press:  14 March 2025

Kurtis J. Swope
Kurtis J. Swope*
Affiliation:
Department of Economics, U.S. Naval Academy, 589 McNair Road Stop 10D, Annapolis, MD 21402, USA
*
email: swope@usna.edu
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Abstract

This paper extends the research on incentive compatible institutions for the provision of public goods by imposing a minimum contribution that must be met in order for an individual to enjoy the benefits of the public good. Excluding individuals who do not contribute at least the minimum transforms the linear n-player pure public goods game to an n-player coordination game with multiple, Pareto-ranked Nash equilibria. The experimental results show that exclusion increases contributions to the public good in most cases. However, an increase in contributions may not be sufficient to increase social welfare because there is a welfare cost to excluding individuals when the good is non-rival. Furthermore, exclusion can decrease both contributions and welfare in environments in which individuals fail to coordinate their contributions. The results are sensitive to the minimum contribution requirement and to the relative returns from the public and private alternatives.

Keywords

public goodscoordinationexperiments

JEL classification

H41: Public Goods C90: General D71: Social Choice • Clubs • Committees • Associations
Type
Research Article
Information
Experimental Economics , Volume 5 , Issue 3 , December 2002 , pp. 209 - 222
Copyright
Copyright © 2002 Economic Science Association

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