Designing feedback in voluntary contribution games - the role of transparency

  • We analyze the effects of limited feedback on beliefs and contributions in a repeated public goods game setting. In a first experiment, we test whether exogenously determined feedback about a good example (i.e., the maximum contribution in a period) in contrast to a bad example (i.e., the minimum contribution in a period) induces higher contributions. We find that when the type of feedback is not transparent to the group members, good examples boost cooperation while bad examples hamper it. There is no difference when the type of feedback is transparent. In a second experiment, feedback is endogenously chosen by a group leader. The results show that a large majority of the group leaders count on the positive effect of providing a good example. This is true regardless whether they choose the feedback type to be transparent or non-transparent. Half of the group leaders make the type of feedback transparent. With endogenously chosen feedback about good examples no difference in contributions can be observed among transparent and non-transparent feedback selection. In both experiments feedback shapes subjects’ beliefs. With exogenously chosen feedback, transparent feedback tends to reduce beliefs when good examples are provided as feedback and tends to increase beliefs in when bad examples are provided as feedback compared to the respective non-transparent cases. Our results shed new light on the design of feedback rovision in public goods settings.

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Author:Bernd Irlenbusch, Rainer Michael Rilke, Gari Walkowitz
Series (Serial Number):WHU – Working Paper Series in Economics (WP 18/01)
Publisher:WHU - Otto Beisheim School of Management
Place of publication:Vallendar
Document Type:Working Paper
Date of Publication (online):2018/04/18
Date of first Publication:2018/04/18
Release Date:2018/04/18
Tag:Experiment; Feedbackgestaltung; Konditionierte Kooperation; Transparenz; Öffentliches Gut
Conditional cooperation; Experiment; Feedback design; Public good; Transparency
Institutes:WHU Economics Group / IHK-Chair of Small and Medium-Sized Enterprises
JEL-Classification:C Mathematical and Quantitative Methods / C9 Design of Experiments / C92 Laboratory, Group Behavior
D Microeconomics / D8 Information, Knowledge, and Uncertainty / D82 Asymmetric and Private Information
H Public Economics / H4 Publicly Provided Goods / H41 Public Goods
Licence (German):Reguläre Veröffentlichung (UrhG)