Experiments on Cooperation and Social Networks

Juan Camilo-Cardenas
Professor, Facultad de Economia Universidad de Los Andes, Bogotá, Colombia Experiments on Cooperation and Social Networks Many public goods need to be produced by, and/or benefit, large number of individuals (tax compliance, charities, global warming, air pollution in cities). Public goods are difficult to produce through voluntary contributions because of the divergence between individual and collective interests and the free-riding problem. This has been widely studied experimentally by economists and social psychologists using the so called Voluntary Contribution Mechanism (VCM) and a there is now a vast amount of experimental data on the factors that trigger contributions, including the material and non-material incentives, social norms, information available, etc. However, most of this literature is based on experiments conducted in rather small groups of 3 to 5 people. Very little experimental evidence exists for experiments with more than 10 players . For larger groups, it is more difficult is to gather information on the critical mass or minimum number of contributors required for any player to be indifferent between contributing or not to the public good. Can social networks provide the institutional setting for the diseemination of information requiered for people to overcome such dilemma of cooperation? I will present a new design of a simple public goods experiment in a large number of players, where 80 people in a computer lab have the possibility to connect with others in the room to induce more cooperators to contribute to the public good and overcome the social dilemma. This experimental design explores the possibility of social networks to be used and institutional devices to create the same behavioral responses we observe with small groups (e.g. commitments, social norms, reciprocity, trust, commitment, shame, guilt) that seem to induce cooperative behavior in the private provision of public goods.