Séminaire COURNOT – Rustam ROMANIUC (Montpellier Business School)

Détails de l'événement :

Title: Endogenous and exogenous group formation in a voluntary contribution mechanism

Co-authors: Andrea Guido (Burgundy School of Business) and Louis Putterman (Brown University)

Short abstract:
In the last two decades, many experiments manipulated the way groups are formed in order to find a solution to the decay of cooperation over time. Chaudhuri (2009 and 2011) notes that endogenous group formation is one of the most effective non-punitive mechanisms to sustain cooperation. Notwithstanding the important amount of work devoted to the study of public goods provision under endogenous group formation, we still lack a proper answer to the question: does endogenous group formation enhance contributions to the public good in comparison to exogenously formed groups? Our aim in this experiment is to fill the gap by providing the first experimental evidence on the value of endogenous group formation in comparison to exogenously formed groups in the context of public goods games. Our results are threefold: we first find that the group composition in our endogenous condition is similar to the group composition in the exogenous condition. Second, we implemented a prediction game with future managers and most of them predicted that the endogenous condition will lead to higher cooperation rates than the exogenous condition. Contrary to their prediction, our results show that cooperation is higher in the exogenously formed groups than in the endogenously formed ones.