Revisiting Kindness and Confusion in Public Goods Experiments

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Abstract
There has been substandd recent interest in determining why there is cooperadon in public goods experiments even in environments that provide all subjects with the incendve to free ride (see e.g., John O. Ledyaid. 1995). Theories used to explain such cooperadon generdly posit either that subjects are "confused" in the sense that they make errors or do not understand the game's incendves, or that subjects contribute due to socid factors such as dtruism and reci- procity. Although severd authors have pointed out the importance of disdnguishing between these dtematives,' the roles that confusion and socid modves play in determining public con- tributions remdn poorly understood. This paper provides new evidence on the way that confu- sion and social motives determine contribudons in public goods games by repordng data from experiments that use a new design widi the Voluntary Contribution Mechanism (VdTM). Two important and often replicated findings in the experimentd public goods literature are (I) that subjects' public contributions are much greater than predicted by standard economic theories of fiee-riding and (2) that these contri- budons decay over the course of muldple-round games (see e.g., Douglas D. Davis and Charles A. Holt. 1993). Models diat employ socid fac- tors to expldn cooperadon and its decay usudly assume that subjects are modvated by dtruism.

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