To Tender or Not to Tender? Deliberate and Exogenous Sunk Costs in a Public Good Game
In an experimental study, we compare individual willingness to cooperate in a public good game after an initial team contest phase. While players in the treatment setup make a conscious decision on how much to invest in the contest, this decision is exogenously imposed on players in the control setu...
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| Format: | Article |
| Language: | English |
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MDPI AG
2018-06-01
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| Series: | Games |
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| Online Access: | http://www.mdpi.com/2073-4336/9/3/41 |
| _version_ | 1818572259415031808 |
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| author | Florian Heine Martin Sefton |
| author_facet | Florian Heine Martin Sefton |
| author_sort | Florian Heine |
| collection | DOAJ |
| description | In an experimental study, we compare individual willingness to cooperate in a public good game after an initial team contest phase. While players in the treatment setup make a conscious decision on how much to invest in the contest, this decision is exogenously imposed on players in the control setup. As such, both groups of players incur sunk costs and enter the public good game with different wealth levels. Our results indicate that the way these sunk costs have been accrued matters especially for groups on the losing side of the contest: Given the same level of sunk costs, contributions to the public good are lower for groups which failed to be successful in the preceding between-group contest. Furthermore, this detrimental effect is more pronounced for individuals who play a contest with deliberate contributions before. |
| first_indexed | 2024-12-14T18:54:42Z |
| format | Article |
| id | doaj.art-7374e55964d741b7ae33450015f40c85 |
| institution | Directory Open Access Journal |
| issn | 2073-4336 |
| language | English |
| last_indexed | 2024-12-14T18:54:42Z |
| publishDate | 2018-06-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Games |
| spelling | doaj.art-7374e55964d741b7ae33450015f40c852022-12-21T22:51:08ZengMDPI AGGames2073-43362018-06-01934110.3390/g9030041g9030041To Tender or Not to Tender? Deliberate and Exogenous Sunk Costs in a Public Good GameFlorian Heine0Martin Sefton1Tilburg Institute of Governance, Tilburg University School of Economics and Management, P.O. Box 90153, 5000 LE Tilburg, The NetherlandsSchool of Economics, Faculty of Social Sciences, University of Nottingham, Nottingham NG7 2RD, UKIn an experimental study, we compare individual willingness to cooperate in a public good game after an initial team contest phase. While players in the treatment setup make a conscious decision on how much to invest in the contest, this decision is exogenously imposed on players in the control setup. As such, both groups of players incur sunk costs and enter the public good game with different wealth levels. Our results indicate that the way these sunk costs have been accrued matters especially for groups on the losing side of the contest: Given the same level of sunk costs, contributions to the public good are lower for groups which failed to be successful in the preceding between-group contest. Furthermore, this detrimental effect is more pronounced for individuals who play a contest with deliberate contributions before.http://www.mdpi.com/2073-4336/9/3/41sunk costspublic goodcontestexperiment |
| spellingShingle | Florian Heine Martin Sefton To Tender or Not to Tender? Deliberate and Exogenous Sunk Costs in a Public Good Game Games sunk costs public good contest experiment |
| title | To Tender or Not to Tender? Deliberate and Exogenous Sunk Costs in a Public Good Game |
| title_full | To Tender or Not to Tender? Deliberate and Exogenous Sunk Costs in a Public Good Game |
| title_fullStr | To Tender or Not to Tender? Deliberate and Exogenous Sunk Costs in a Public Good Game |
| title_full_unstemmed | To Tender or Not to Tender? Deliberate and Exogenous Sunk Costs in a Public Good Game |
| title_short | To Tender or Not to Tender? Deliberate and Exogenous Sunk Costs in a Public Good Game |
| title_sort | to tender or not to tender deliberate and exogenous sunk costs in a public good game |
| topic | sunk costs public good contest experiment |
| url | http://www.mdpi.com/2073-4336/9/3/41 |
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