Anomalous Behavior in Public Goods Experiments: How Much and Why?
Thomas R. Palfrey
California Institute of Technology - Division of the Humanities and Social Sciences
Jeffrey E. Prisbrey
Government of the United States of America - Mass Media Bureau
The American Economic Review, December 1997
We report the results of voluntary contributions experiments where subjects are randomly assigned different rates of return from their private consumption. These random assignments are changed round to round, enabling the measurement of individual player contribution rates as a function of that player's investment cost. We directly test these response functions for the presence of warm-glow and/or altruism effects. We find significant evidence for heterogeneous warm-glow effects that are, on average, low in magnitude. We statistically reject the presence of an altruism effect.
JEL Classification: C92, C92, H41
Date posted: May 1, 1998