INCREMENTAL CONTRIBUTION IN STEP-LEVEL PUBLIC-GOODS GAMES WITH ASYMMETRIC PLAYERS

We consider public good games with asymmetric players in which players are assigned different endowments and must then decide privately how much to contribute to the group′s benefit. Each member receives a fixed reward-regardless of the magnitude of his/her contribution-if the sum of contributions is equal to or larger than an exogenously determined provision threshold and zero otherwise. The results show that (1) heterogeneous groups are less successful in providing public goods than homogeneous groups; (2) group members contribute the same proportion of their endowment regardless of its magnitude; (3) the distribution of endowments and the provision threshold interact; and (4) some subjects adhere to an equity principle, others maximize expected utility, and yet others do not subscribe to either of these two models. © 1993 Academic Press, Inc.