Leaders as Role Models for the Voluntary Provision of Public Goods

28 Pages Posted: 1 Nov 2014

See all articles by Simon Gaechter

Simon Gaechter

University of Nottingham; IZA Institute of Labor Economics; CESifo (Center for Economic Studies and Ifo Institute)

Elke Renner

University of Nottingham

Abstract

We investigate the link between leadership, beliefs and pro-social behavior. This link is interesting because field evidence suggests that people's behavior in domains like charitable giving, tax evasion, corporate culture and corruption is influenced by leaders (CEOs, politicians) and beliefs about others' behavior. Our framework is an experimental public goods game with a leader. We find that leaders strongly shape their followers' initial beliefs and contributions. In later rounds, followers put more weight on other followers' past behavior than on the leader's current action. This creates a path dependency the leader can hardly correct. We discuss the implications for understanding belief effects in naturally occurring situations.

Keywords: leadership, beliefs, experiments, public goods, path dependency, public policy, management

JEL Classification: C72, C90, H41, Z13

Suggested Citation

Gachter, Simon and Renner, Elke, Leaders as Role Models for the Voluntary Provision of Public Goods. IZA Discussion Paper No. 8580, Available at SSRN: https://ssrn.com/abstract=2517883

Simon Gachter (Contact Author)

University of Nottingham ( email )

University Park
Nottingham, NG8 1BB
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Elke Renner

University of Nottingham ( email )

University Park
Nottingham, NG8 1BB
United Kingdom

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