Fairness and Bargaining Power in Threshold Public Goods Experiments

Abstract

Experiments on three two-person threshold public good provision games, namely, the simultaneous, sequential, and dictator games, are conducted to explore the motives behind giving. Players who move simultaneously are endowed with equal bargaining power, and players who move first are endowed with more bargaining power than players who move subsequently. Dictators are indubitably endowed with complete bargaining power. Since the differences between the bargaining powers of two playersn increase from the simultaneous to the sequential to the dictator game, comparisons among games allow us to trace whether the contribution behavior is motivated by fairness or is simply due to the strategic concern. The experimental evidence shows that the strategic concern explains the overall contribution behavior better than the motive of fairness. However, in the final round 26% of the dictators share the threshold evenly with their opponents, suggesting that some subjects do play fairly.