The Effect of Leadership in a Public Bad Experiment

Erling Moxnes · Eline van der Heijden

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Experimental Behavioral Economics Studies Climate Change Policy and Economics Game Theory and Applications

Abstract

In the face of global or regional environmental problems, do countries that take unilateral actions inspire other countries to curtail emissions? The effect of leadership at the individual level is investigated by the use ofa novel design ofa laboratory public bad experiment with a leader. Twelve groups of5 participants played the game twice with two treatments: 10 rounds with a leader and 10 rounds without a leader. The order ofthe treatmentswas balanced over groups. A significant (within-subject) effect of leadership is found. Followers invest, on average, 13% less in the public bad when there is a leader setting the good example as opposed to a situation with no leader. This produces benefits also to the leaders but not enough to recover all the costs of taking a leading position.

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References

1999A Theory of Fairness, Competition, and Cooperation 2000ERC: A Theory of Equity, Reciprocity, and Competition 2011Incorporating Fairness into Game Theory and Economics 1995The Handbook of experimental economics 19952. Public Goods: A Survey of Experimental Research 2001Are people conditionally cooperative? Evidence from a public goods experiment 1992Covenants with and without a Sword: Self-Governance Is Possible 1969The Diffusion of Innovations among the American States

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