INCOME REDISTRIBUTION AND PUBLIC GOOD PROVISION: AN EXPERIMENT

Jonathan Maurice · Agathe Rouaix · Marc Willinger

49 citations0/0 files storedInternational Economic Review

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Experimental Behavioral Economics Studies Game Theory and Voting Systems Economic Policies and Impacts

Abstract

We experimentally investigate the impact of income redistribution on voluntary contributions by groups of four subjects. We compare equalizing and unequalizing redistribution. Our data are consistent with the neutrality theorem: Redistribution does not affect the amount of voluntarily provided public good at the group level. However, at the individual level, subjects tend to underadjust with respect to the Nash prediction. We also observe an insignificant adjustment asymmetry between the poor and the rich: Subjects who become poorer adjust their contribution by a larger absolute amount than subjects who become richer. Finally, poor subjects tend to overcontribute significantly more than rich subjects.

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References

1975Judgment under Uncertainty: Heuristics and Biases 1999A Theory of Fairness, Competition, and Cooperation 2007z-Tree: Zurich toolbox for ready-made economic experiments 1990Impure Altruism and Donations to Public Goods: A Theory of Warm-Glow Giving 2011Incorporating Fairness into Game Theory and Economics 1952Social Choice and Individual Values 1955Cardinal Welfare, Individualistic Ethics, and Interpersonal Comparisons of Utility 2001Are people conditionally cooperative? Evidence from a public goods experiment

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