1. Economic Science Association World Meetings 2010
Visibility of Contributions and Cost of Information: An Experiment on Public Goods
Anya C. Savikhin
The University of Chicago
Vernon Smith Experimental Economics Laboratory, Purdue University
Roman M. Sheremeta
Chapman University

2. Motivation
Recommendation from existing literature for increasing contributions: recognize all contributors in easily accessible location (Andreoni and Petrie, 2004; Rege and Telle, 2004)
Too many contributors and this becomes difficult

3. Visibility of Information
Charities may publicize names of largest donors – this may also introduce some degree of competition between contributors concerned about prestige
Less costly to view
Donors who contribute small amounts are not recognized
All names could be publicized but this list is long (Yahoo)
Costly to view
All donors (even small amounts) are recognized
Contribution: Is it more effective to recognize all contributors (but this information may not be visible), or recognize only top contributors?

4. Experimental Design Procedures
z-Tree (Fischbacher, 2007)
Subjects earned $14 each on average (20 francs = $1, 2 periods selected for payment)
Session lasted for about minutes
Public Goods Game (VCM) (Groves and Ledyard, 1977)
Fixed matching into groups of 5 participants , same groups for entire session (20 periods)
Endowment of 80 experimental francs per period
MPCR = 0.4
End of each round: ranked members and display contribution of each member

5. Experimental Treatments
Control (none shown)
(T)
Only top 2 recognized
(A)
All contributors recognized
(AC)
All recognized, costly to view
(3 francs)
40 (2 sessions)
Digital photos with name to identify subjects to one another (similar to Andreoni and Petrie, 2004)

6. Results: Overview
Result 1: A significantly increases contributions relative to N
Result 2: T increases contributions only marginally relative to N
Result 3: AC does not have a significant effect on contributions as compared to A  with 20 periods and 40 individuals in the AC treatment, the number of times photos are viewed is 74/800 (9.2%).
There are significant coordination differences in the minimum game between the SeqMed and SeqMin treatments (Fisher’s exact test, p-value < 0.05) and SeqMed and Sim treatments (Fisher’s exact test, p-value < 0.05). However, there is no significant coordination difference in the minimum game between the SeqMin and Sim treatments (Fisher’s exact test, p-value = 0.61).

7. Leaders, Laggards, Prestige, Guilt
“Leaders” set an example by contributing a lot
Any individual who contributed 75%+ of endowment in the 1st period
“Laggards” contribute little
Any individual who contributed 25%- of endowment in the 1st period
Prestige effect: Causes to contribute large amounts of endowment if I am recognized – more “leaders”
Guilt effect: Causes to contribute if my small amount is recognized – fewer “laggards” 7

8. Prestige and Guilt
(N)
(T)
(A)
(AC)
Compare to the Baseline (N)
☝☝Leaders
(Laggards are not explicitly revealed)
☟☟Laggards
☝Leaders
☟Laggards ✘ ✔ ✔☝ ✔ ✔
Result 4: T not statistically significantly different in leaders or laggards relative to N
Result 5: A increases leaders & decreases laggards relative to N.
Result 6: AC similar in leaders as A, but significantly more laggards than A
13 A Chi^2 goodness of fit test has a p-value of 0.04 when comparing leaders, and a p-value of 0.01 when comparing laggards. 14 A Chi^2 goodness of fit test has a p-value of 0.81 when comparing the distribution of laggards between the T and N treatments.15 A Chi^2 goodness of fit test has a p-value of 0.05 when comparing laggards and a p-value of 0.66 when comparing leaders. 8

9. Overall Distribution of Contributions9

10. “Followers”
The “social interaction effect” increases contributions of followers given more leaders, and decreases contributions of followers given more laggards
17 A Wilcoxon Mann-Whitney rank-sum test shows that followers in groups with a greater proportion of leaders as compared to other groups contribute significantly more (p-value < 0.05).

11. Conclusions
Replicates previous findings that revealing identities significantly increases overall contributions
We find that display of all information, even if it is costly to view, is more effective than displaying only top contributors
By increasing proportion of leaders and decreasing proportion of laggards
This causes contributions by followers to increase
Designers of online community groups and charities should display full information, even if it is costly to view