Journal of Economic Interaction and Coordination

, Volume 15, Issue 1, pp 111–132 | Cite as

Voluntary contributions in a system with uncertain returns: a case of systemic risk

  • Annarita ColasanteEmail author
  • Aurora García-Gallego
  • Nikolaos Georgantzis
  • Andrea Morone
Regular Article


This paper investigates systemic risk that emerges from the interplay between uncertain returns to individual actions, uncertainty on others’ behavior and all this filtered through individual attitudes toward risk. We design a finitely repeated linear public good experiment based on a voluntary contribution mechanism and analyze the effect of risky and uncertain returns on subjects’ contributions. Results from a baseline treatment without uncertainty are compared with two risky treatments characterized by different values for the marginal per capita return. In the treatments with risk, subjects are randomly assigned to one out of three feasible marginal per capita returns, independently of what their individual contribution was. Results show that a sufficient level of uncertainty leads to significantly lower individual contributions. Furthermore, in a system with lower contributions due to uncertainty, subjects’ risk aversion enhances the systemic risk, leading the system to collapse.


Uncertainty Systemic risk Exogenous risk Public good game Experiment 

JEL Classification

D84 E37 G12 



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Copyright information

© Springer-Verlag GmbH Germany, part of Springer Nature 2019

Authors and Affiliations

  • Annarita Colasante
    • 1
    Email author
  • Aurora García-Gallego
    • 1
  • Nikolaos Georgantzis
    • 1
    • 2
  • Andrea Morone
    • 3
  1. 1.LEE and Department of EconomicsUniversitat Jaume ICastellón de la PlanaSpain
  2. 2.CEREN EA 7477, Burgundy School of BusinessUniversité Bourgogne Franche-ComtéDijonFrance
  3. 3.Dpto. di Economia, Management e Diritto d’ImpresaUniversità degli Studi di BariBariItaly

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