Public Goods Provision with Rent-Extracting Administrators

Journal article


Publication Details

Author(s): Cagala T, Glogowsky U, Grimm V, Rincke J
Journal: Economic Journal
Publication year: 2018
ISSN: 0013-0133
Language: English


Abstract


This paper studies public goods provision in an experiment in which contributors repeatedly interact with rent-extracting administrators. Our main result is that the presence of an administrator reduces contributions but only because rent extraction lowers the MPCR. Analysing the dynamic interactions between the contributors and the administrator, we demonstrate that rent-extraction and cooperation shocks trigger short-run adjustments in the agents’ behaviour. However, shocks do not have permanent effects. This explains the long-run resilience of cooperation to rent extraction. We also show that cooperative attitudes and trust are traits that explain permanent differences in the short-run volatility of public goods provision.


FAU Authors / FAU Editors

Cagala, Tobias
Lehrstuhl für Volkswirtschaftslehre, insbesondere Wirtschaftspolitik
Glogowsky, Ulrich
Lehrstuhl für Volkswirtschaftslehre, insbesondere Wirtschaftspolitik
Grimm, Veronika Prof. Dr.
Lehrstuhl für Volkswirtschaftslehre, insbesondere Wirtschaftstheorie
Rincke, Johannes Prof. Dr.
Lehrstuhl für Volkswirtschaftslehre, insbesondere Wirtschaftspolitik


How to cite

APA:
Cagala, T., Glogowsky, U., Grimm, V., & Rincke, J. (2018). Public Goods Provision with Rent-Extracting Administrators. Economic Journal. https://dx.doi.org/10.1111/ecoj.12614

MLA:
Cagala, Tobias, et al. "Public Goods Provision with Rent-Extracting Administrators." Economic Journal (2018).

BibTeX: 

Last updated on 2018-11-05 at 10:38