Competition for status creates superstars: An experiment on public good provision and network formation

Boris van Leeuwen, Theo Offerman, Arthur Schram

Research output: Contribution to journalArticleScientificpeer-review

Abstract

We investigate a mechanism that facilitates the provision of public goods in a network formation game. We show how competition for status encourages a core player to realize efficiency gains for the entire group. In a laboratory experiment we systematically examine the effects of group size and exogenously monetarized status rents. The experimental results provide very clear support for the concept of challenge-freeness, a refinement that predicts when a repeated game equilibrium will be played, and if so which one. Two control treatments allow us to reject the possibility that these observations are driven by social preferences, independently of the competition for status.
Original languageEnglish
Pages (from-to)666-707
JournalJournal of the European Economic Association
Volume18
Issue number2
DOIs
Publication statusPublished - Apr 2020

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