Competition, cooperation, and collective choice

Thomas Markussen, Ernesto Guillermo Reuben Paris, Jean-Robert Karl Tyran

Abstract

The ability of groups to implement efficiency-enhancing institutions is emerging as a central theme of research in economics. This paper explores voting on a scheme of intergroup competition which facilitates cooperation in a social dilemma situation. Experimental results show that the competitive scheme fosters cooperation. Competition is popular but the electoral outcome depends strongly on specific voting rules of institutional choice. If the majority decides, competition is almost always adopted. If likely losers from competition have veto power, it is often not, and substantial gains in efficiency are foregone.
Original languageEnglish
PublisherDepartment of Economics, University of Economics
Number of pages50
Publication statusPublished - 2012
SeriesUniversity of Copenhagen. Institute of Economics. Discussion Papers (Online)
Number04
Volume2012
ISSN1601-2461

Keywords

  • Faculty of Social Sciences

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