Simultaneous Decision-Making in Competitive and Cooperative Environments
32 Pages Posted: 8 Feb 2011 Last revised: 6 Mar 2012
Date Written: March 5, 2012
We experimentally investigate simultaneous decision-making in two contrasting environments: one that encourages competition (lottery contest) and one that encourages cooperation (public good game). We find that simultaneous participation in the public good game affects behavior in the contest, decreasing sub-optimal overbidding. Contributions to the public good are not affected by participation in the contest. The direction of behavioral spillover is explained by differences in strategic uncertainty and path-dependence across games. Our design allows us to compare preferences for cooperation and competition. We find that in early periods, there is a negative correlation between decisions in competitive and in cooperative environments.
Keywords: cooperation, competition, public goods, contests, experiments, behavioral spillover
JEL Classification: C72, C91
Suggested Citation: Suggested Citation