Learning with whom to Interact: A Public Good Game on a Dynamic Network

We use a public good game with rewards, played on a dynamic network, to illustrate how self-organizing communities can achieve the provision of a public good without a central authority or privatization. Given that rewards are given to contributors and that the choice of whom to reward depends on social distance, free-riders will be excluded from rewards and the (almost efficient) provision of a public good becomes possible. We review the related experimental economics literature and illustrate how the model can be tested in the laboratory

Quo vadis CPS? Brief answers to big questions

Research on complex problem solving (CPS) has reached a stage where certain standards have been achieved, whereas the future development is quite ambiguous. In this situation, the editors of the Journal of Dynamic Decision Making asked a number of representative authors to share their point of view with respect to seven questions about the relevance of (complex) problem solving as a research area, about the contribution of laboratory-based CPS research to solving real life problems, about the roles of knowledge, strategies, and intuition in CPS, and about the existence of expertise in CPS

The Pay-What-You-Want Game and Laboratory Experiments

This paper introduces the Pay-What-You-Want game which represents the interaction between a buyer and a seller in a Pay-What-You-Want (PWYW) situation. The PWYW game embeds the dictator game and the trust game as subgames. This allows us to use previous experimental studies with the dictator and the trust game to identify three factors that can influence the success of PWYW pricing in business practice: (i) social context, (ii) social information, and (iii) deservingness. Only few cases of PWYW pricing for a longer period of time have been documented. By addressing repeated games, we isolate two additional factors which are likely to contribute to successful implementations of PWYW as a long term pricing strategy. These are (iv) communication and (v) the reduction of goal conflicts. The central implication of this study is that the results from experimental economics can provide guidance to developing long-term applications of PWYW pricing

Combating climate change: Is the option to exploit a public good a barrier for reaching critical thresholds? Experimental evidence

The achievement of collective climate targets is hampered by a large number of factors. Most obvious is the conflict between self-interest and group interest at both the intra- and intergenerational level. Several experimental studies examine the effects of factors such as wealth heterogeneity, varying thresholds, or time discounting on the probability of achieving a collective climate target. In these experiments, participants act as a group and can invest money in a collective group account over a fixed number of rounds. If the group account is below a threshold after the last round, the members of a group usually lose a large proportion of their potential assets. However, in the real world, agents can not only invest in public goods, but also exploit them. We therefore study cooperation dynamics in a threshold climate change experiment in which group members can not only contribute money into their group account, but also take money out of it. We induce endowment heterogeneity by simulating the contribution decisions in the first rounds of the experiment and vary the loss rate between treatments. Our results show no significant differences between give and give-take treatments. Consistent with the results of previous studies, we find that with a lower loss rate, less groups reach the threshold