Working Paper: CEPR ID: DP8319
Authors: Antonio Cabrales; Hayde Lugo
Abstract: We analyze the effect of a large group on an impure public goods model with lotteries. We show that as populations get large, and with selfish preferences, the level of contributions converges to the one given by voluntary contributions. With altruistic preferences (of the warm glow type), the contributions converge to a level strictly higher than those given by voluntary contributions, even though in general they do not yield first-best levels.
Keywords: efficiency; lotteries; public good; warm glow
JEL Codes: D64; H21; H41
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| population size (J11) | level of contributions (D64) |
| warm glow preferences (D15) | level of contributions (D64) |
| altruistic preferences (D64) | level of contributions (D64) |