Delegation and Public Pressure in a Threshold Public Goods Game
Many public goods cannot be provided directly by interested parties (e.g. citizens), as they entail decision-making at nested hierarchical scales: at a lower level individuals elect a representative, while at a higher scale elected delegates decide on the provision level, with some degree of scrutiny from their constituency. Furthermore, many such decisions involve uncertainty about the magnitude of the contribution that is needed for the good to be provided (or bad to be avoided). In such circumstances delegates can serve as important vehicles for coordination by aggregating societal preferences for provision. Yet, the role of delegation in threshold public goods games is understudied. We contrast the behavior of delegates to that of self-representing individuals in the avoidance of a public bad in an experimental setting. We randomly assign twelve subjects into four teams and ask each team to elect a delegate via majority voting. The elected delegates play several variants of a one-shot public goods game in which losses can ensue if the sum of their contributions falls short of a threshold. We find that when delegation is coupled with a mild form of public pressure, it has a significantly negative effect on contributions, even though the non-delegates can only signal their preferred levels of public good contributions. The reason is that delegates give more weight to the least cooperative suggestion: they focus on the lower of the two public good contributions recommended by their teammates.
KeywordsDelegation Cooperation Threshold public goods game Climate experiment
JEL ClassificationC72 C92 D81 H4 Q54
We would like to thank Astid Dannenberg, Michael Finus, Andreas Lange, Tatsuyoshi Saijo, Timo Goeschl (editor), and two unknown referees for their helpful suggestions. All remaining errors are ours. This work was supported in part by funding from the National Research Foundation of Korea (Grant No. 201322021.01). Lee’s work was supported by Research Resettlement Fund for the new faculty of Seoul National University.