The Role of Trust, Endogenous Institutions, and the Possibility of Grace in Public Goods Provision

2008 ◽  
Author(s):  
Douglas A. Norton ◽  
R. Mark Isaac
Keyword(s):  
Public Goods ◽  
Public Goods Provision ◽  
Endogenous Institutions

Ethnic Diversity and Ethnic Discrimination: Explaining Local Public Goods Provision

2017 ◽  
Vol 51 (10) ◽  
pp. 1351-1383 ◽  
Author(s):  
Alexander Lee
Keyword(s):  
Public Goods ◽  
Ethnic Diversity ◽  
Service Provision ◽  
Ethnic Discrimination ◽  
Local Public Goods ◽  
Public Goods Provision ◽  
Northern India ◽  
Local Problems ◽  
Using Data

Numerous studies have found that ethnic diversity is negatively associated with the provision of local public goods. However, these accounts neglect both the strong role of central institutions in the provision of many “local” public goods and the frequently positive correlation between diversity and the presence of less politically powerful ethnic groups. These factors suggest that existing diversity findings may be explained in some cases by central governments discriminating against areas inhabited by less powerful groups. This hypothesis is tested using data in village-level public goods provision in Northern India, supplemented by data on service provision in Kenyan villages and American cities. While there is evidence that the presence of socially powerful groups is positively associated with service provision, evidence for the diversity hypothesis is weak. The results suggest that failures of public services in diverse areas may reflect larger inequalities within the political system rather than local problems in cooperation.

Ethnic Segregation and Public Goods: Evidence from Indonesia

2018 ◽  
Vol 112 (3) ◽  
pp. 637-653 ◽  
Author(s):  
YUHKI TAJIMA ◽  
KRISLERT SAMPHANTHARAK ◽  
KAI OSTWALD
Keyword(s):  
Public Goods ◽  
Ethnic Groups ◽  
Ethnic Diversity ◽  
Strong Support ◽  
Ethnic Segregation ◽  
Public Goods Provision ◽  
Ethnic Fractionalization ◽  
Disaggregated Data ◽  
Local Segregation

This article contributes to the study of ethnic diversity and public goods provision by assessing the role of the spatial distribution of ethnic groups. Through a new theory that we callspatial interdependence, we argue that the segregation of ethnic groups can reduce or even neutralize the “diversity penalty” in public goods provision that results from ethnic fractionalization. This is because local segregation allows communities to use disparities in the level of public goods compared with other communities as leverage when advocating for more public goods for themselves, thereby ratcheting up the level of public goods across communities. We test this prediction on highly disaggregated data from Indonesia and find strong support that, controlling for ethnic fractionalization, segregated communities have higher levels of public goods. This has an important and underexplored implication: decentralization disadvantages integrated communities vis-à-vis their more segregated counterparts.

scholarly journals Institution Formation in Public Goods Games

2009 ◽  
Vol 99 (4) ◽  
pp. 1335-1355 ◽  
Author(s):  
Michael Kosfeld ◽  
Akira Okada ◽  
Arno Riedl
Keyword(s):  
Theoretical Analysis ◽  
Public Goods ◽  
Formation Process ◽  
Social Dilemma ◽  
Public Goods Provision ◽  
Public Goods Games ◽  
Institution Formation ◽  
Group Welfare ◽  
Endogenous Formation

Sanctioning institutions are of utmost importance for overcoming free-riding tendencies and enforcing outcomes that maximize group welfare in social dilemma situations. We investigate, theoretically and experimentally, the endogenous formation of institutions in public goods provision. Our theoretical analysis shows that players may form sanctioning institutions in equilibrium, including those governing only a subset of players. The experiment confirms that institutions are formed and that it positively affects cooperation and group welfare. However, the data also shows that success is not guaranteed. Players are unwilling to implement equilibrium institutions in which some players have the opportunity to free ride. Our results emphasize the role of fairness in the institution formation process. (JEL C72, D02, H41)

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