PROVIDING GLOBAL PUBLIC GOODS: ELECTORAL DELEGATION AND COOPERATION |
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| Authors: | Martin G Kocher Fangfang Tan Jing Yu |
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| Affiliation: | 1. +49 89 21809726+49 89 2180999726;2. Department of Economics, University of Munich, 80539, Munich, Germany;3. Institute of Advanced Studies, Vienna;4. Department of EconomicsUniversity of Gothenburg;5. +1 650 4506026+49 89 242465299;6. Max Planck Institute for Tax Law and Public Finance, Munich, Germany;7. Department of Economics, University of Munich, 80539, Munich, GermanyWe thank the responsible editor and two anonymous referees, Daniel Houser, Jens Grosser, Ernesto Reuben, Matthias Sutter, Roberto Weber, Johanthan Woon, participants of the ESA European Conference in Cologne, the ESA North American Meeting in Tucson, the first joint workshop between the University of Innsbruck and the Max Planck Institute for Tax Law and Public Finance, the 88th Western Economic Association International Annual Conference in Seattle, as well as seminar participants at the Universities of Amsterdam, Munich, Vermont, and Zurich for helpful comments and suggestions. All remaining errors are ours. |
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| Abstract: | This study experimentally examines the effect of electoral delegation on providing global public goods shared by several groups. Each group elects one delegate who can freely decide on each group member's contribution to the global public goods. Our results show that people mostly vote for delegates who assign equal contributions for every group member. However, in contrast to standard theoretical predictions for our delegation mechanism, unequal contributions across groups drive cooperation down over time, and it decreases efficiency by almost 50% compared to the selfish benchmark. This pattern is not driven by delegates trying to exploit their fellow group members, as indicated by theory. It is driven by conditional cooperation of delegates across groups. Since one of the potential sources of the resulting inefficiency is the polycentric nature of global public goods provision together with other‐regarding preferences, we use the term P‐inefficiency to describe our finding. (JEL C92, D72, H41) |
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