Chapter 85 Spiteful Behavior in Voluntary Contribution Mechanism Experiments

One of the basic findings in public good provision experiments via the voluntary contribution mechanism is that subjects contribute a considerable amount of their initial holdings to the provision of a public good even when no contribution is the dominant strategy. On the other hand, there are three fundamental criticisms of voluntary contribution mechanism experiments. First, most experiments to date have used a linear utility function where the marginal return of a public good out of one unit of contribution of a private good is less than one. The second criticism is on the linearity of a utility function. In usual theoretical analyses, economists use a non-linear utility function. The third criticism comes from mechanism design theory. Mechanism designers implicitly assumed that agents in their mechanisms must participate in the mechanisms.