Environmental and Resource Economics

, Volume 61, Issue 3, pp 365–383 | Cite as

On the Provision of Public Goods with Probabilistic and Ambiguous Thresholds

  • Astrid DannenbergEmail author
  • Andreas Löschel
  • Gabriele Paolacci
  • Christiane Reif
  • Alessandro Tavoni


Many natural systems involve thresholds that, once triggered, imply irreversible damages for the users. Although the existence of such thresholds is undisputed, their location is highly uncertain. We explore experimentally how threshold uncertainty affects collective action in a series of threshold public goods games. Whereas the public good is always provided when the exact value of the threshold is known, threshold uncertainty is generally detrimental for the public good provision as contributions become more erratic. The negative effect of threshold uncertainty is particularly severe when it takes the form of ambiguity, i.e. when players are not only unaware of the value of the threshold, but also of its probability distribution. Early and credible commitment helps groups to cope with uncertainty.


Cooperation Experiment Public good Threshold uncertainty Ambiguity 

JEL Classification

C72 C92 H41 Q54 


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Copyright information

© Springer Science+Business Media Dordrecht 2014

Authors and Affiliations

  • Astrid Dannenberg
    • 1
    • 2
    Email author
  • Andreas Löschel
    • 3
    • 4
  • Gabriele Paolacci
    • 5
  • Christiane Reif
    • 3
  • Alessandro Tavoni
    • 6
  1. 1.Earth InstituteColumbia UniversityNew YorkUSA
  2. 2.Environmental EconomicsUniversity of GothenburgGothenburgSweden
  3. 3.Centre for European Economic Research (ZEW)MannheimGermany
  4. 4.Alfred Weber Institute for EconomicsUniversity of HeidelbergHeidelbergGermany
  5. 5.Rotterdam School of ManagementErasmus UniversityRotterdamThe Netherlands
  6. 6.Grantham Research Institute on Climate Change and the EnvironmentLondon School of Economics and Political ScienceLondon UK

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