1984 the Free Rider Problem_Experimental Evidence

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Public Choice43: 3-24 (1984).

d 1984 MartinusNijhoff Publishers,TheHague.Printed n the Netherlands.

The free rider problem: Experimental evidence*

OLIVERKIM

Temple University

MARKWALKER

S. U.N. Y., Stony Brook

Conventional wisdom has long held that in a group which is providingitself with some public or common good, each member of the group will

have a strong tendency to be a 'free rider' - to contribute little or nothingtoward the cost of the good, while enjoying its benefits as fully as any other

member of the group. Economic theory of a more formal stripe makes the

same prediction: that the free rider problem will cause a group to provideitself with no more than a minimal level of the public good, even when

every member of the group could be made better off if the public good

were provided at a much greater level. When a group is observed to avoidthe free rider problem, it is presumably because some countervailing force

has been introduced which tends to punish or otherwise discourage free

riding behavior. In small groups, for example, the prospect of social op-

probrium may often be sufficient to induce group members to eschew free

riding in favor of more 'acceptable' behavior. An extended non-technical

development of this view is given by M. Olson (1965).Both conventional wisdom and economic theory have been called into

question recently be a series of research papers which report experimentalstudies of collective decision-making about public goods. Almost without

exception, these papers have reported results that cast serious doubt uponthe importance - and, in some cases, even upon the very existence - of

the free rider problem. The results range from those of Sweeney (1973), in

which group members 'free rode' less severely than expected, all the wayto the results of Bohm (1972), in which there appears to have been no free

riding whatsoever. In between lie the results reported by Smith (1980),Marwelland his associates (Alfano and Marwell, 1978; Marwell and Ames,

1979, 1980a, 1980b) and Scherrand Babb (1975), in all of which there seem

* The experiment eportedhere was fundedby the EconomicResearchBureauat SUNY,StonyBrook. WilliamDawesassisted n conducting he experiment.Helpfulcommentsand

suggestionswere madeby MarkIsaac, SusanO'Leary,and severalanonymousNationalScienceFoundation eferees.

Department f Economics,StateUniversityof NewYork, StonyBrook,NY 11794.

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4

to havebeenstrong ncentives or individualso freeride,butin whichthe

degreeof free ridingbehavioractuallyobservedwas not substantial.In this paperwe reporton an experiment n which the outcome was

strikinglyat odds with the above-mentioned xperimental esults. Freeridingbehavior n the reported xperimentwasoverwhelming, ystematic,and verymuchin accord with economictheory.

We have recentlybecome aware of two unpublishedpapers (Isaac,McCue and Plott, 1982; Plott, 1982),whichwere sent to us by CharlesPlott after a first versionof this paperhad been circulated)which also

report substantialfree ridingbehaviorin experimental ituations.Plott

(1982)constructed xperimentalmarkets n whichtherewas an externalitythat affected individual upplycurves,andhe observed hat subjects freerode' in the sensethat, at any given price, theytendedto eachsupplythe

quantitythat equatedtheir own individualmarginalcosts to the price,rather han the (smaller)quantity hat wouldhave resultedhadtheytakenaccountof the 'social' marginalcosts due to the externaleffects of theirindividualsupplydecisionsupon othersubjects.Isaac, McCueand Plott

(1982) reporton an experiment imilar o our own, whichtheyconductedtwo monthsbefore ourexperiment.Theemphasis n theirexperimentwason repititionandlearning thatis also one of the emphases n our experi-

ment), and they obtained resultsquite similarto the ones we will reporthere.'

In contrast with all the experimentswe have cited in the second

paragraph the experimentshat have not found a significant ree rider

problem- the experimentwe are about to reportwas designedwith the

express objective that economic theory yield a clear and unequivocalpredictionof freeridingbehavior,so thatthe experimentwouldconstitutea valid test of the theory.It is important o keepin mindthat a carefully

drawn,wellarticulatedheory s indispensablendrawing cientificconclu-sions from experimental bservations.It is only via some kind of theorythat one can forgethe necessary nferential ink betweenan experimentaldesignandpredicted xperimental bservations.Thus,the firststepin our

experimentalnvestigationwas a purelytheoreticalone: a simplepublicgoods situationwas devisedand standard conomictheoryappliedto the

situation,so thatwe would have before us a clearstatementof the logicalargument hat yieldsthe predictionof free ridingbehavior.

By wayof contrast, n eachof theprevious xperiments n the free rider

problem(exceptIsaac et al, 1982 and Plott, 1982), one or more factorswere presentthat would have rendered nvalidthe theoreticalargumentthat group members will 'free ride.' Thus, while the relative absence of free

riding behavior in these previous experiments suggests that there are many

public goods situations in which the free rider problem is less severe than

in the pure, polar case we have devised, it is nevertheless not valid to con-








5

clude from the previousresultsthat economictheoryis wrong, or that itis inapplicable o problems nvolvingpublic goods, or that the free rider

phenomenon s non-existent.Instead,becauseof the presenceof the 'in-

validating actors' mentionedabove, economictheorywassimplynot be-ing testedby theseexperiments.

After identifyinga numberof invalidating actors that werepresent n

previousexperiments,we designeda newexperimenthat was intended oavoid suchfactors,so that economictheorywouldyielda definitepredic-tion of freeridingbehavior n the experiment.Then,if the outcomeof the

experimentwere to exhibit no significantfree ridingbehavior,we could

concludewith much more confidence than before that therereallyis nofree rider

phenomenonand that economic

heoryprovidesno useful model

of people'sbehavior n public goods situations.

Instead,the outcome of this new experimentdisplayedsubstantial ree

ridingbehavior,thus suggesting hat the free riderproblemof economic

theory s quitea realphenomenonafterall. Theoutcomefurthermoreug-

geststhat an explanationof the previous,contraryexperimental esults s

likelyto be foundin one or more of the invalidatingactorsthat werepre-sent in previousexperiments.

The remainder f the paperwill be organizedas follows. In SectionI we

willdescribea simplepublicgoodssituationand willgivea carefuldevelop-mentof standard conomic heoryas it applies o thatsituation.InSection2 we will give a briefdescriptionof each of the five previousresearch f-forts that have addressed he questionwhether hereis reallya free rider

problem.In Section 3 we will describe he invalidating actorsreferred o

above, factorswhich,if present n anexperimentalituation,would renderthe theory of Section 1 inapplicable,in the sense that the free rider

phenomenondeveloped n Section1would no longerbe an implicationof

the theory.We will also indicate n Section3 which of these factors seemto havebeenpresent n each of the previousexperimentalnvestigations fthe free riderproblemexceptIsaac et al., (1982)and Plott (1982). In Sec-tion4 we willdescribeourownexperiment,whichseemsto avoidallof the

invalidating actors of Section 3, and in Section 5 we will describetheresults obtainedwhen the experimentwas conducted. Section6 containssome concludingremarks.

1. Publicgoods and the free riderproblem

We will find it useful to have before us a brief, elementary statement of

the formal economic theory of public goods and their provision via volun-

tary contributions. This will provide us with a language in which to con-

duct the discussion and will help to avoid ambiguity.








6

To help us fix ideas, let us considerthe followingsimple example,inwhichthe homeownersn a givenarea are about to enter into a contractwith a mosquito-abatementirm.Supposethat thereare n homeownersn

the area,andsuppose hat eachSpring he Homeowners'Associationcon-tracts with the firm to sprayx gallons of mosquito-abatementolution

during he season,at a priceof 0 dollarsper gallon.The Associationmustdecide each Spring upon the level of x for that year. The mosquito-abatementsprayis the public good in our example.

The Homeowners'Associationmightuse any one of an infinitevarietyof methodsfor decidinguponthe level x of abatement hatit willprovide.And it is not only x that the groupmust choose: it must also collect the

Oxdollarsto pay for thepublic

good. Thus, it must choose a distribution

tqI, .. , t of taxes to levy on the n members of the association, and these

taxes must satisfythe condition

n

E ti = Bxi=l 1

Nowsuppose hat eachhomeowner's reference anbe describedbya utili-

ty functionui of the formui (x, ti), each functionof coursedecreasingn

ti. To keep mattersas simpleas possible, let us supposethat ui(x, ti)=

-tj + vi(x); in otherwords,the functionvi(&)ndicateshow muchhome-owner would bewilling o pay (onhisown, if therewereno others o con-

tribute) o obtainanygivenlevel of mosquitoabatement.We will refer tothe functionsvi as 'valuation unctions.'We define an optimalchoice forthe group to be any choice (x, ti, ... t,,) for which the public good level

nx maximizes he aggregatevaluationunction V(x)= i vi(x). If each in-

i=l 1

dividualvaluationvi is differentiable,henit is easyto see that an optimal

provision evel x is one that satisfies the Samuelsonmarginalcondition

S(Xi=)

i= 1

i.e., the aggregatemarginalwillingnesso pay (the 'marginal ocialvalue')must be equalto the good's marginalcost to the group.

Now supposethat the homeowners'groupusesthe method of director

voluntarycontributions o determine ts choice. Then each homeowner's

tax t1willsimply

be the amount of his contribution,and the abatement

1 nlevel will be x=

1=8Eti, viz., whatever evel can be purchasedwith the

contributions btained.How willthislevelcomparewiththeoptimal evel,say ^?It is herethat we allegedlycome face to face withthe free riderpro-blem. If each individual were to assume that the contributionsof theothers would be unaffectedby the amount of his own contribution(a








7

plausibleassumptionf thegroup s sufficiently arge),theni would be like-

ly to choose a very small contribution i: any largercontributionwould

seemto providea relatively mallpositive ncremento hisutility (through

its effect on the abatementevelx), as compared o the directnegative n-crementrepresentedby the largercontribution.

For a more formal analysis of the voluntarycontributionmethod,assume hat eachhomeowner,whencontemplatinghe contributionti that

he willmake,has someexpectationabout whatthe otherswill contribute,andthat he thereforehassomeexpectationabout what the abatementevel

will turn out to be. Let us denotehomeowner 's expectationabout x by

iX, and then let us ask whether here is any patternof suchexpectationsthat couldbe sustainedas an

equilibrium i.e.,is there

anylevel of abate-

mentx with theproperty hat, if everyoneexpectsx to occurand behaves

accordingly, henx will in fact occur, therebyreinforcing he originalex-

pectation.In otherwords, is thereany abatement evelxe such that

(1) each homeownerhas a utility-maximizingontribution ! that is

consistentwith his own expectationbeing x xe; and1 n

(2) xe =-st

p?2

To answerthis question, let us assumethat each individual'svaluation

vi(x) is concave - i.e., that the valueof a marginalncrease n abatement

never increases as the abatementlevel x is made larger. Then an in-

dividual'sbehaviorcan be describedas follows:

(3) if v/(ir)> , then i will increaseti;(4) if vI(x')<<3and ti> 0, then i will decreaseti;(5) if vj(Zi)<< and ti = 0, then i will not alter ti.

Noticethat themarginalvaluefunctionvi is nothingbut the homeowner'sinverse demand function for the public good, two typical examplesofwhich are depictedin Figure 1. (Valuationfunctions which everywheresatisfy vi(x)c are clearlyof no interest,and we rule them from con-

sideration.)Conditions 3)-(5) make it clearthat we want to focus attentionupon

eachhomeowner's demandat the price0' - that is, uponthe abatement

levelx at whichvl(x)= 0 (moreprecisely,upon

the smallestabatementevel

x for whichv/(x)5_

0.) We denote homeowner 's demandat ( by hi, as in

Figure1.

Now we can re-stateconditions(3)-(5) as follows:

(3') if X%i, then i will increase i;

(4') if ?> xi and ti> 0, then i will decreaseti;(5') if

i/> ii and ti= 0, then i will not alterti.








8

8

$

Vj(X)

Vj(X)

xEj Ei

Figure 1.

Whenwritten n thisway, it is clearthat an equilibriummustsatisfyboth

(6) xe- i

for each i,

and

(7) t = 0 for all i such that xe> i.

In other words, the equilibriumabatement evel must be equal to the

largestdemandai at 3,and all homeownerswith smallerdemandsatgi will

be 'total freeriders,'contributingnothing.Of course,xe will be less than

the optimallevelk; at 2 the sum of all marginalvalues is 0, but at xe atleast one homeowner'smarginal alue saloneequalto0. If therearemanyhomeowners whose marginal values vi'(Xe) re non-negligible at Xe, then the

sumatxe will be much arger han0, and we canexceptXeto be farbelow

x.It will be convenient o summarize his 'free rider'implicationof our

theoryin a singlestatement,or hypothesis:

(H)If the method f voluntaryontributionss used o determinehelevel at which a publicgood will be provided,then the resulting

provision evel will be far belowthe optimallevel, andmanyin-dividualswill contributeothing t all.

Clearly, hishypothesis s an implicationof the theoryonly if certaincon-ditions are satisfied,such as 'the groupis large,' 'thereis a non-pathol-








9

ogicaldistribution f individualvaluations n thegroup,'andmanyothers.

2. Previous research

Five researchers r research eams havepreviouslyconductedexperimentsthat were eitherdesigned expressly o determinewhetherthere is a freeriderphenomenon,or else theirexperimentswerecloselyenoughrelated othis questionthat their resultshave been interpreted s evidencethat the

phenomenon s weak or non-existent.We give here a brief descriptionofeach of theseexperimental fforts. Each seems to have containedone ormore features hat could invalidate t as a test of

(H);wewilldescribe hese

'invalidatingactors' n the followingsection,and will indicate n that sec-

tion which of the factors seemed to be present n each experiment.Bohm: Bohm did not directlyinvestigate he voluntarycontributions

method, but instead posed six alternativeschemes for eliciting groupmembers' willingnesso pay' for a discrete binary)publicgood. A collec-tion of volunteerswasdivided nto six groups,with a differentschemeap-pliedto eachgroup.Eachgroupwastold thatif it reporteda largeenoughtotal willingness o pay (but groupswere not told how large was 'large

enough'),then thegroupwould be givena closed-circuithowingof a cer-tain televisionprogram.One of the elicitationschemeswas essentially hemethodof voluntary ontributions, xceptthatthegroupwas offeredonlya binarychoice insteadof the continuouschoice offered in the theoryofSection1. Becausesome of Bohm'sother five schemesseemedto provide

strong ncentivesnot to underreport ne's willingness o pay (or marginalvaluation), Bohm interpreted he almost identical resultsunder all hisschemesto meanthat the voluntarycontributionsmethod, in particular,

inducedvirtuallyno free ridingbehavior.Sweeney:Sweeney'sexperiment oncentratedupon voluntarycontribu-

tions. He placedsubjects(students n one of his courses)upon stationarybicycles,whichwereconnected o a generatorof electricalpower.The sub-

jects were not able to observeone another,but wereeach able to observea light bulb that would be illuminated olely by the pedallingof all sub-

jects. The subjectswere told that the grade they would all receive in

Sweeney'scoursewould be increasedby an amount related o the average

brightnessat which

theywould maintain he

lightbulb. Total free

ridingdid not occur - everysubjectdid some pedalling- but there seemedtobe some evidence hat when a subjectperceived he others to be pedallingless vigorously, she followed suit, reducing her own pedalling effort.

Sweeney concluded that his subjects were exhibiting at least a mild form

of free-riding behavior.

Scherr and Babb: Scherr and Babb attempted to compare the outcomes








10

from threealternativemethodsfor group decision-making bout public-good levels;one of the three methodswas the methodof voluntarycon-tributions. Pairs of subjects (i.e., groups of size n= 2) were given ten

dollarsapieceandthen asked to contributeup to fifty cents(in the volun-tarymethod) o a 'concert und' and to a 'library und.'Theexperimentersfound that 'few of the subjectsattempted o free ride.' After the experi-ment, the subjectsgave the followingreasonsfor theirreluctance o freeride: '(1) feeling of being cheap; (2) funds were worthwhile;and (3)altruisticreasons.'

Smith: Smith'sexperiments reby far the best conceivedand executedof all previouswork in this area. Smithperformedexperimentsdesignedto

compareseveralalternativemethodsfor

group decision-makingbout

publicgoods, includinga voluntary-contributions-typecheme. His sub-

jectscommunicatedwith one anotheronlythrough hecomputer erminalsat whichtheysat, andonly viathe interactive rogramusedfor theexperi-ment. He inducedvaluations n his subjects as described n the followingsection), and used significantamounts of money to motivate each in-dividual'schoice. His experimentdeparted rom our modelof voluntarycontributions,however,byasking terativelyorprospective ontributions,with none of the public good provideduntil(and unless)eachsubjecthad

agreedto both the total prospectivecontributionand his own individualprospectivecontribution.The results of Smith'sexperimentsed him to

concludethat the voluntarycontributionsmethod 'yield(s) public goodquantitiessignificantly argerthan the free-riderquantity.Hence, under

unanimity[italics added], it appears hat empiricalsupportfor the free-riderhypothesis s veryweak. This result is consistentwith that reportedby Bohm, Sweeney,and Marwell-Ames sing quite diverseexperimentalparadigms.'

Marwell,et al.: Marwelland his associateshave performedmany ex-periments,reportedin four papers, all directedsolely at the questionwhetherthere is a free riderproblemunderthe voluntarycontributionsmethod.All but one of theirexperimentswereperformedwithMadison,Wisconsinhigh school studentsas subjects(the exceptionused first-yeardoctoral studentsin economics). Each subject was given a number of

tokens,each of whichcould eitherbe redeemed or cashor contributed ofinancea publicgood. In most experimentshe subjects'valuationswereinduced

(asdescribed n the

following section).Without

exception,the

observedcontributionswere somewhatbelowthe group optimumbutfarabove the free-riding evel. The only significantdifference between the

results of Marwell's various experiments was that the economics students

tended to free ride a bit more than the high school students.








11

3. Invalidating actors

In each of the experimentsdescribed n the precedingsection, the ex-

perimental utcomeswere nterpreted s rejecting he free-rider ypothesis(H) that we derived n Section1 from economictheory.It is important o

keepin mindthat there s a theorythatliesbehind(H), and thatanyrejec-tion of (H) is thereforea rejectionof the theory.To be morespecific, if,in a certainsituation,(H) is rejected,then that is a situationto which the

theorydoes not apply. For any theory,of course,therewill be situationsin whichthe theoryis not applicable.The conclusionthat 'the free rider

phenomenondoes not exist' - the universal ejectionof (H) that is foundin all

previousexperimentalesearch n this

question- is a statement hat

there is no situationto which the theorywe have outlined is applicable.Our own view, beforeconductingan experimentof our own, was that

therearesituations o which the theorywe have outlinedapplies - situa-

tions in which the free riderphenomenon houldthereforebe observed-butthatit requires greatdeal of careto constructexperimentalituationsto which the theorywill apply. There are a numberof factorswhich, ifallowed to intrude nto the experimental ituation,will render he theorywe have outlined napplicable, ndtherefore nvalidate hesyllogismwhich

requires hat (H) be observed: If the theoryapplies,then (H) will occur;the theoryapplies; herefore H) will occur.' In this section we willgive abriefdescription f nineof these 'invalidatingactors,'each of whichwas

present n one or more of the experimentsdescribed n Section 2.It should be pointed out here that the presenceof some of these in-

validating actors n an experimental esigndoes not necessarilymeanthatthe resultingpublic goods situation s uninteresting r unrealistic. ndeed,mostnon-experimental,realistic'publicgoods situationssurelyexhibitat

leastone, if not several,of these factors.Thefactorsdifferfrom one situa-tion to the next, however, and it is impossible, at a single stroke, todiscoverthe effects of each individual actor or combinationof factors.

Ourobjective,therefore,was to devise a 'pure'public goods situationthat would serve as a sort of benchmarkagainstwhichto evaluate he ef-fects of re-introducing ny factors that add 'realism.'If the outcome ofsucha 'pure'experimentwereto clearlyexhibit he free riderphenomenon(as, indeed,it did - see Section5), thenthe previousexperimental esultswould have to be

re-interpreted.The

interpretationhat 'there is no free

riderphenomenon'would have to be replacedby the interpretationwhen

a publicgoods situation ncludessuch-and-suchactors, therewill be no

significant free rider problem.' And, of course, an explanation of the

results would then require that the theory be extended, to explicitly incor-

porate such features as uncertainty, disequilibrium behavior, and in-

dividuals' perceptions about their ability to affect others' actions.








12

We enumerateherethe nineinvalidating actorsthat seemto have been

present n one ormoreof thepreviouspublicgoods experiment, ndfollowwith a brief descriptionof each factor.

IF 1. Publicgood not 'pure'IF 2. Publicgood discreteIF 3. Group optimumunknownIF 4. Misunderstandingnd vaguenessIF 5. Uncertaintyand disequilibriumIF 6. Insufficienteconomic motivationIF 7. SmallgroupIF 8.

Transitoryndowment ncome

IF 9. Lack of anonymity

(IF 1)Publicgood not 'pure.'Supposethat inourmosquito-sprayxam-

ple, it were possible to apply an additionalgallon of sprayeithernearhomeownerA, or alternativelynear homeownerB. If this is allowed(orif it is perceivedby the groupmembers o be allowed)then the level of

mosquito-abatements no longera pure public good: the group'schoicecannot be restricted to the n + 1 variables x and ti, ... , t,, and the theory

embodied n the utilityfunctionsui would not yieldthe behavior 3)-(5).This factor is easyenoughto avoidin experiments, nd the only previousexperimentn whichit mighthave beenpresent in subjects'perceptions)is Sweeney.

(IF 2) Publicgood is discrete.The extremeexampleof a discretechoicesituation s a binarychoice:either hepublicchoicewillbeA (for example,'spray10,000gallons'), or else it will be B (say, 'don't sprayat all.). Of

course, many public goods decision situations do have this discrete

character, utthetheoryembodiedn theutilityfunctionsui requires ddi-tionalassumptions o yieldpredictionsabout individualbehavior n thesecases. While this is an interestingproblem,we choose to concentratehereon the freeriderproblem n its moststraightforwardorm.As with(IF 1),this factor is not difficult to avoid in experiments,but some previousstudies have included t (Bohmand Scherr-Babb), erhapsbecausethese

researcherswerespecificallynterested n studying uchdiscrete ituations.

Severalof Marwell'sexperimentscontainedan elementof discreteness:

none of the publicgood could be had unless the total contributions Eti)exceeded omespecifiedminimum whichMarwell efers o as a 'provisionpoint').

(IF 3) Group optimum unknown. In general, it is impossible for the ex-

perimenter to know his subjects' utility functions, and thus impossible to

know the group optimum 2. When.

is not known, it will not be clear

whether a particular observation is consistent with (H) or not. There is a








13

wayto avoidthisproblem n experimentalituations:namely,one defines

the publicgood to be simply he totalamountcontributedi.e., x = Eti, sothat 0 = 1), and then each subject s given a pre-specifiedvi function(or

payoff table)which ndicateshow muchmoneyhe willbe awarded or anylevel of x that should occur. This method of 'induced valuations,'

pioneeredby Smith(1975)is probably he only wayto ensure hat the ex-

perimenterknows the optimallevel x. Among previousresearchers on-cernedwithpublicgoods, onlySmithand Marwell ollowedthisapproach.

(IF 4) Misunderstanding and vagueness. It is quite common, both in

everyday situations and in experimentalsituations, that substantialnumbersof participantsail to understand ome important eatureof the

situation:subjects may

not understand he nature of thepublic good,perhapsbecause it was describedwith too little precision; hey may not

understand he nature of the voluntarycontributionsmethod;they maynot evenbelieve heexperimenterwhenhe describes heexperimentalitua-tion to them. Most such misunderstandingan be avoidedby inducingvaluationsas described n (IF 3), and by repeating he decision situationoften enoughthatsubjects earnby experiencehow the experimentworks;

conversely,whensuch devicesare not used,misunderstandingsrealmostinevitable.In one of Marwell'sexperiments, or example, he subjects all

of whomwereaboutto move onto thesamedormitory loor)were old thatthe publicgood, to be financed romtheircontributions,wouldbe a partyor a stereo system, with no further detailsprovided. In the Bohm ex-

periments, he group was led to believethat its choice would determinewhethera televisionserieswith two of Sweden'smostpopularentertainerswouldor would not be developed or Swedish elevision.Inboth cases,theexactnatureof thepublicgood seems o have beenquiteunclear o the sub-

jects, and the subjectsmadeonly a single,one-time decision.Smith'sex-

periments seem to have avoided these sources of misunderstanding.Marwell's xperiments sedinducedvaluations,butoffered no opportuni-ty for learning.

(IF 5) Uncertainty and disequilibrium. This factor overlaps to some ex-

tent with (IF 4), but here we singleout an individual'suncertaintyabouthis expectations . Consider our mosquito-abatementxample, for in-stance: f this is the firstyearthat the grouphas proposed o spray,theneach homeowner s likelyto have only a vague idea how largex will be;but after several successive

years of usingthe

voluntarycontributionsmethod, each homeownerwill likely have a fairly 'tight' estimate of x.

Moregenerally, hepatternof expectationsmay simplybe a disequilibriumpattern, in which case the theory as stated would not apply. The question

of individuals' responses out of equilibrium is an important one: if expec-tations do not generally converge to an equilibrium, then the theory will

be generally inapplicable. Among previous experiments, only those of








14

Sweeneyand Smithseemto haveallowedsubjectsanysignificant harpen-ing,viaexperience, f expectations bout he othersubjects'actions.Smith's

experiments rovidesome evidence hatexpectationsmayconverge.

(IF 6) Insufficienteconomicmotivation.If an individual'sactionshaveeconomic consequences hat are insignificant,then the extent to whichthose consequencesnfluencehis behaviorwill be overwhelmedby other

considerations, uch as the desire o feel he has behaved well'vis-A-visheother subjectsor the experimenter, r an interest n the experimentas a

gameor diversion.A similar ackof sufficientmotivationwill often occur

when it is quite unclear to a subject just what the consequencesof hisvariouschoiceswill be. All previousexperiments xceptSmith's are opento serious

questionon the

possibleweaknessof the economic motivation

that they induced n theirsubjects.(IF7) Smallgroup.Unlessthegroupthat is choosinga public-good evel

is fairly arge(and t is not clearhowlarge s 'large'for thispurpose), herearetwo influences hat arelikelyto workagainst reeridingbehavior,each

stemming romthe fact that in a smallgroupan individual's ontributionwill have a 'morenoticeable'effect on the total amountcontributed,andtherefore on his fellow group members.One influenceis the altruisticdesire o helpthe othermembersof thegroup,and the otheris the greaterperceptionhat one's own contributionmight directlynfluence uturecon-tributionsof the othermembers, f thegroupwill be repeatinghe decision

processin the future.Only Marwelland Bohm are completelysecureonthis count;Scherrand Babb,by contrast,experimentedwithgroupscon-

sistingof onlytwo persons.Smithused as manyas ninesubjects,which for

many purposesmight be large enough. The decision method he used,however,was not exactlythe voluntarycontributionsprocedurewe have

outlined,but ratheran iterativeprocedurenvolvingprospectivecontribu-

tions that were to be implemented nly if the group unanimouslyagreed.It is generallybelieved hatunanimitybecomesmuch moredifficult to ob-

tain as the populationof a groupis increased; herefore,validationof his

approachwouldseemto requireexperimentswithgroupsof substantiallymore than nine persons.

(IF 8) Transitory ndowment ncome. The effect of this factor is not

altogetherclear, but it seems to have been extremely mportant n Mar-

well'sresearch,andperhaps n someof the otherefforts as well. Marwell

distributed certainnumberof tokensto eachof his subjectsand then toldthe subjects hat each token could eitherbe exchanged or cash(at a speci-fied rate),or couldbe contributed o the financingof a publicgood. (Seethe description of Marwell's research above for more detail.) With only

one exception (an experiment in which the subjects were doctoral students

in economics), the experimental groups' total contributions were about

half of their endowment of tokens. Post-experimental questionnaires re-








15

vealed 'surprisingunanimityof thought regardingwhat was considered

fair; ... morethan threeout of four [of thesubjects] houghtthat "abouthalf" or more of a person'sresourcesshouldbe contributed,and more

than one out of fourthoughtpeoplewho were fairwouldcontributeall oftheir tokens.' This suggests mmediately hat there is somethingseriouslywrongwith theexperimental esign hat was used:in anyrealistic ituation

people simply do not contributeanythingremotelyapproachinghalf of

their resources o financinga single public good. The most obvious ex-

planation or the experimental ppearance f thisphenomenon- incomeeffectsin the individuals'demand orutility)functions- must be dismiss-edon theground hat the income ncrements resimply oo small.Theonly

plausible xplanationeemsto be

somethingakinto the

permanentncome

hypothesis: he income from the tokenswas a transitory,one-time ncre-

ment, whichperhapsfor that reasonwas treateddifferentlyby subjectsthan their regular,continuing, 'permanent' ncome. If this factor is of

general mportancen experimentsdealingwith economicbehavior,thenboththeSmithandScherr-Babbesultsare called nto questionalongwiththose of Marwell.

(IF9)Lackof anonymity.Therearethreekindsof anonymity hatoughtto be preservedn experimentalettings n ordernot to compromiseheap-plicabilityof the theory.A subject'scontributions houldnot publiclybeascribedto him; no participant hould know the identitiesof the other

groupmembers; ndthesubject's nteractionwiththeexperimenterhouldbe kept as impersonaland anonymousas possible. Violation of any ofthese anonymityconditionsmight significantlyalter subjects'behavior.Since many interestingnon-experimental ublic goods situationsviolateone or more of these conditions,it is an interestingquestionwhat effecton behavior his has. It is impossible o answersuchquestions,however,

withouthavinga soundtheorythat will enable us to isolate these effectsby the presenceor absenceof the variousconditionsof interest.It is thusall the more mportant o understandhe 'pure'case outlined n Section1.All previousexperimentseem to have satisfied he firstanonymitycondi-tion (that contributionsbe anonymous);Smith's and Marwell'sexperi-mentsseemalso to have satisfiedthe second condition(that participants'identities houldnot be known o one another);and the Smithand Marwell

procedures eemto have beenreasonably ecureon the thirdcondition as

well (the impersonality f subject-experimenternteraction).We can summarizeby sayingthat none of the five previousresearch f-fortscan be regardedas a valid test of the free riderhypothesis,(H).3 In

each of these efforts there were strong reasons why we should not have ex-

pected the theory that lies behind the hypothesis (H) to be applicable. In

the next section we will outline an experiment which seems to avoid all of

the invalidating factors that were present in these previous efforts.








16

4. The experiment

Wewill describe he experimentby firstreproducing,n condensed orm,

the instructions hat weregivento each of the experimentalubjects,andthen we will pointout the importantor distinctive eaturesof this experi-mentaldesign, featureswhich enable us to avoid the invalidating actorsdescribed n Section 3.

The condensed nstructions:

The experimentwill consist of a 'play' eachweekdayfor about fourweeks.Eachplaywillbeorganized rounda 'common und'of money

(...the

'public good'in this

experiment).These instructions are ac-

companiedby a table or schedule[Schedule1] showinghow much

moneyyouwillearnon a givendayforanylevelthatmightbeattained

by that day's fund.....

There are exactly 100 people involved in this

experiment,ncludingyourself. .... Everydayeach one of the 100par-ticipantswilldecideupona sum of moneyto 'pledge'to the common

fund,andwillphonehis orherpledge o ouranswering eviceat 246-

6547.At theendof aday's play,at 2:00P.M., wewilltotal thepledgesto determine he fund's level for that day, and each participant's

'gross earnings'for that day will be determined rom the schedule.

(Each participant has the same schedule.) ... (The total will not

typicallybe a multipleof 100, so we will [interpolate].) .. In orderto determinehow mucha participantwill actuallyreceiveon a givenday - i.e, his or her 'netearnings'- wewilldeduct he participant'spledge from his or her 'gross earnings' ... Phoning in your pledgeeach day is simple. Just decide how muchyou want to pledge, andthendial 246-6547 (before2:00 P.M.) andgive the answeringdevice

your I.D. number and your pledge. ... Each day between 5:00 and8:00 P.M. one of our assistantswill deliveryournet earnings or the

dayto you in an envelope.Theenvelopewillalso containa noticein-

forming you what the total pledge was that day ... We prefer ... that

our assistant notmeet withyou whendroppingoff theenvelope]...We willarrange or a placefor our assistant o leavetheenvelopeeach

day.

SCHEDULE1

If thegroup'sotal Theneachperson'spledgetoday is: 'gross earnings'will be:

$ 100 .............................................. $ 2.00200 ................................................... 4.00








17

Continued.If the group'stotal Then each person's

pledgetoday is: 'gross earnings'will be:

$ 300 .............................................. $ 6.00400 .................................... 8.00500 ...................................... 10.00600 ...................................... 12.00700 ...................................... 14.00800 ...................................... 14.50900 ...................................... 15.00

1000...................................................... 15.50. . . .. . . .

f o e 0 0 0 0 * 0 0 0 0 0 0 6 0 6 * 6 0 0 0 6 6 0 *

0 9 0 0 0 0 0 . 0 9 0 * 0 0 z l u t

Note that, in terms of the theoryin Section 1, a subject'scontribution ion a givenday is simplythe amount of his pledgethat day; the resulting

100

public-good evel is x= ti, i.e., the totalof all pledgesbythe groupthati= 1

day; and the 'price'of a unit of the public good therefore = $1.00.

Certain eaturesof thisexperimental esignare worthnoting. Theyare:

(a) Inducedvaluations.Thepayoff schedule Schedule1) servesas each

subject'svaluation functionvi(x):

.02x,if

x_

5700

vi(x)= 1

1 4 + 2 0 0x y : 7 0 0 .

Figure2 depicts he functionvi(x), as wellas themarginalvaluationv'(x).Ourmotivation or choosinga piecewise-linearaluationwasto keepvi as

simpleto describe he subjectsas we possiblecould. For reasonsthat wewilldescribebelow,thepayoffor valuation chedulewasaltered wice dur-

ing the experiment, o yield Schedules2 and 3:

Schedule2: Schedule3:

.05x, fx_

500 .07x, fx_

s500vi(x)= 1 vi(X)= 1

25+- x, ifx_500.

35+- x, ifx=

500.200 200

(b) 'Strong' ree riderhypothesis.The optimal provisionlevel underSchedule1 is ^X=700(a pledgeof $7.00persubject).However,each sub-








18

vi (x)$14 vi

$ 0 OUU x

$1.0o p= $1.00

.00

.00 1 v'(X)$$700

$700

Figure2.

ject'smarginal/valuation,'(x), sonly$.02,whichs far ess han heunitcostof i =$1.00.Thus,each ubject's emands i=0. Inotherwords,hetheoryyieldsa sharper ypothesishan(H), namely:

(H*) Every ubjectwillcontributexactly ero.

MarwellndAmesrefer o (H*)as the'strongreeriderhypothesis.' his

stronger ypothesislso follows romSchedules and3, underwhich he

optimal rovisionevels$500 $5.00per ubject), ut nwhich i(x) s$.05under cheduleand$.07under chedule,bothof which ieldndividualdemands f i =0.

(c) Large roup.Theuse of a largegroups of course equiredn orderto avoid heinvalidatingactor F7, and t is also of some mportancen

maintaininghe mpersonalityequiredoavoid F9. Thenumber 00waschosen orthe(alleged)ize of thegroupbecauset was almost ertainly'largeenough,'and because t would enablea subject,whentold the

group'sotalcontribution,o readily etermine hat heaverageper ub-

ject)contributionadbeen,simplybydividing y 100.








19

We did not in fact use 100subjects n the experiment:he cost of doingso wouldhavebeenfar too great f wewere also to provideenough moneyto avoid IF 6 and enough repetition o avoid IF 5. Instead,we used only

five subjects.An importantvirtueof the experimentaldesign is that itmakespossibleexperimentswhichmaintain, o a smallnumberof subjects,the illusion that there are many subjects;the designtherefore makes it

possible to conduct experimentswhich can simulatelarge groups at a

reasonable ost. Themaintaining f the illusion of many subjectsrequiresa bit of carein calculating he provision evel x from the five pledges; his

point will be takenup at the end of this section.

(d) Opportunityor learning.As we indicated n our discussionof IF 4

andIF 5, it is important hat subjectshave someexperiencewith the deci-sion situationandwith the (aggregate) eactionsof others n the situation.

This canbe assuredonly by repeating he situation.We intended o repeatuntilanequilibriumwas attained asevidencedby all subjectsrepeatinghe

samepledges),butas we will indicate n the followingsection,several ac-

torsmade it impossible o carryon the experiment or enough repetitionsto quiteachieveequilibrium.

(e) Everyday etting. In orderto ensurethat the experimental bserva-

tions would be influencedas little as possibleby the fact that the settingwas an experimental ne, we attempted o devise a settingthat wouldbe

typicalof a continuing,repeated roupdecisionproblem suchas the once-

a-yearproblem n ourmosquito-sprayingxample).We felt thatit wasim-

portantto give subjectstime to reflect upon their own and the others'

previous pledges,and that it was also important o allow individuals omake their decisions in the same way that they make their non-

experimentalpendingdecisions - at home, withoutany contactwith an

experimenter. t is worthnoting, too, that the illusion of a largenumber

of participantswould have beendifficult to maintain f we hadconductedthe experimentby gathering he subjects togetherat one location. Theseconsiderationswould have made t extremelydifficultto repeatat intervalsof lessthanone day:it would havebeenvirtually mpossible o coordinatethe timingof all subjects'decisionsand our reporting o subjectsof the

provision level on the previous play and our deliveryof the earningsgeneratedon the previousplay. (Again, it was felt that, to maintaintherealistic ettingandto reinforce he subjects' nformationandmotivation,

earningsshould be deliveredafter each play, instead of beingallowedtoaccumulate.)It is also worth noting that the populationfrom which wechose oursubjectswasmorerepresentativef the generalpopulation han

in most previous experiments.

(f) No transitoryendowment. In order to avoid the factor IF 8, subjects'

earnings were generated only by the provision level attained each day. No

automatic payments were made or promised at any time. This posed some








20

difficultywhen(as reportedn the followingsection)substantial reeridingoccurred: arningsbecameso small hatthe motivational alueof the earn-

ingswassuspect asin IF6), and we therefore eplaced hepayoff schedule

with a new, more remunerative chedule.(g) Anonymity:Of the threekindsof anonymitydescribedn the pre-

vious sectionunderIF9, onlythe last(i.e., impersonalnteractionwiththe

experimenter) equiredany intricacy n design. Our use of a telephoneansweringdevice, I.D. numbers nsteadof names,and anonymousdrop-off of earningswereall directed oward hisproblem.It is noteworthy hatno face-to-facecontactbetweenany experimenterndanysubjecteveroc-curredduring,before, or after the experiment.

(h)Adequatemonetaryewards.On

any givenday,a

subject'sown deci-

sion (i.e., the amount that he chooses to pledge)could reasonablybe ex-

pected(withSchedule1)to liebetween$0and$7. The choicethat he would

actually ake, then, would have a substantial ffect upon his net earningsfor that day (his pledgewould haveonly a verysmalleffect upon vi(x).)This substantialeffect is heavilyreinforcedby the dailyrepetitionof thedecisionsituation: he roughlyseven dollarvariation n dailynet earningsthat arisesfrom his rangeof choice becomes about $35 per week.

As it turned out when we conductedthe experiment, hese variations,

although formallycorrect, are misleading.Free ridingbehaviorwas so

overwhelming, o quickly, that a subjectwould earn negativeamounts

(afterdeductinghispledge)unlesshe wereto pledgeverycloseto zero, andeven a pledgeof zero wouldonly earn a dollaror so (see Section5). Thisled us to replace Schedule 1 with Schedule2. This change in payoffschedules s discussed urther n Section 5.

One finalaspectof the experimental esign s important:namely,the rule

by which the experimenterswould transform he five subjects' responseson a givenplayinto a 'total contribution,'or provision evel,x. Onlyfive

pledgeswould bereceived achday,but a largegroupwas simulatedby set-

ting eachday'sprovision evelx as if there weretwentycopiesof eachofthe actualsubjects- nineteenartificial ubjectsor 'clones'for each actual

subject.With one exception,the clones of a given subjectwere assumedto pledgethe same amount as the subjecthimself - in otherwords, if Tdenotes he sum of thefive actualsubjects'pledges, hen theprovisionevel

wouldbex=

20T. In order o maskthe useof these clones from the actualsubjects- i.e., to maintain he illusion that therewerereally manymore

subjects- we did not wantx to be alwaysa multipleof 20, so a random

number r (distributed uniformly between -10 and 10) was added each day

to the total, with the result that the experimenters' rule for determining x

was x = 20T+ r. The single exception to this rule was also motivated by the

need to mask from the subjects the fact there were so few of them. Suppose








21

that on day numberD four of the five subjectswere observedto pledgethe same amountas on the previousday, and let At denote the change n

the remaining subject's pledge from day D-1 to day D. If the rule

x = 20T+ r were followed, then the corresponding hangein x would beabout20T, and thesubjectwhohadchangedhispledgemightwellperceivethat he was havinga greatereffect than only one in a hundred.Conse-

quently,wheneveronly one subjectalteredhis pledgefrom the previous

day, his nineteencloneswere assumednot to changetheirpledges:x wasdetermined by the formula x = 20TD- 1 + At + r, where To- denotes the

value of T on the previousday.

5. The results

As we have describedn the preceding ection, five subjectswereselected,all of whom were led to believethat there wereactually100subjects.The

experiment onsistedof eleven'plays,'on successiveweekdays rom7 July1980 to 21 July 1980.

The experimental esults are given in Tables 1 and 2. The tables are

divided nto three sections:The first threedays, duringwhichSchedule1wasused;the next sevendays, duringwhich Schedule2 wasused;and theeleventhday, on which Schedule3 was used. Each row of the tablesgivesthe results of one day's play. The subjectsare identifiedby their I.D.numbersatop the columns of Table 1.

For the most part, the tables speak for themselves; he presenceand

severityof the free riderphenomenonare indisputable.With Schedule1,underwhich$700 was the optimal provision evel, the level actuallyob-

Table 1. Subjects' pledges (ti's)I.D. I.D. I.D. I.D. I.D.

Day # # 16 #93 # 67 # 29 # 68 T= 2ti

1 $0 $0 $2$51--

$7 $14.33

2 0 0 0 2 7 9.00

3 0 0 0 1 3 4.00

4 0 0 2 3 3- $ 8.50

5 0 0 3 3 0 6.00

6 0 0 2 2 0 4.00

7 0 0 2 2 3 7.008 0 0 2 1 * *9 0 0 1 1 0 2.00

10 0 0 1 1 5 7.00

11 0 0 2 10 5 $17.00








22

Table2. Aggregatequantities

(1) (2) (3) (4) (5)

Day # T= Eti 20T 20T/I x vi(x)

Payoff $14.33 $287 41% $296 $5.92schedule # 1 2 9.00 180 26% 185 3.70

(X= $700) 3 4.00 80 11% 77 1.54

4 $ 8.50 $170 34% $172 $8.605 6.00 120 24% 116 5.80

Payoff 6 4.00 80 16% 75 3.75

schedule # 2 7 7.00 140 28% 89 4.45

( = $500) 8 * * * 85* 4.25

9 2.00 40 8% 48 2.4010 7.00 140 28% 52 2.60

Payoff

schedule #3 11 $17.00 340 68% - -

(x= $500)

* On Day # 8 no pledgewas received romSubject# 68.Column(1): T denotes the sum of the five actualsubjects'pledges.Column(2): The provision evelif there had been 100subjects just

like' the five actualsubjects.

Column(3): The realizedprovision evelas a percentage f the op-timal provision evel.Column(4):x is the provision evelthat wasreported o the subjects;

payoffs werebased on these. Calculated s describedatthe end of the preceding ection.

Column(5):The grosspayoff to each subject.A subject'snet payoffis vi(x) minus his pledge.

served 20T,inColumn2of Table2)wasonly$287ontheveryfirstday,andit quickly plummetedon the next two days to $180 and then $80. With

Schedule , underwhich heoptimumwas$500,the nitialobservedevelwas$170 (it was likelythe first threedays' experience hat accountedfor the

reduction romthe$287totalon the initialdaywith Schedule1). It fell a bit

moreslowly,but almostas surely.Finally,on theeleventhday,one subjectreacted nexplicablyo the newschedule,butevenwith his $10pledge,the

provision evel was only $340.We wereunable,due to both financialand

timeconstraints,o conductrepeatplayswithSchedule , butthe earlier eac-

tions of subject #29, togetherwith the obviousgain he would receiveby

reducinghis$10pledge,suggest hattheprovisionevelwouldhavedeclinedjust as it did underSchedules1 and 2.

One reason ortheone-dayswitch o Schedule3 wasto gainsomeinsightinto the learningof the subjects:wouldthey perceive hat the structureofSchedule3 wasjustthesameas Schedule1and2, and then reason hattheyought ocontinue heirrecentow-pledgebehavior nsteadof increasingheir

pledges n response o the schedulechange?Clearly,suchlearninghad not








23

takenplacewithall fivesubjects. t wouldseemto be animportantquestionfor futureresearchwhether uchlearningeveroccurs,andif so, how longit takes to occur undervaryingcircumstances.Because his is essentiallya

questionabouthowlongit takes o achieveanequilibriumfter earninghastakenplace,such researchwouldtell us a greatdeal about the applicabilityof ourequilibriumheoryacrossvaryingpubic-goodsdecision ituations. n

anycase,theimportance f learningof repitition- for the avoidanceof

invalidatingactorsIF4 andIF 5 is clearlyestablishedn Table1.

Finally,we should note that there remainsome observations or which

there s no clearexplanation: he verylarge pledgeby subject# 29 on day# 11,andseveralof thepledgesby subject#68. Nevertheless,f our limited

sampleof

onlyfive

personss at all

representative,5hen this

experimentprovidesevidence hat the freeriderphenomenon,as embodied n (H), is

quite real. The interpretationof previous experimental esults as proofeither hat thephenomenondoes notexist,or that it is 'veryweak,'is there-fore apparentlyan invalidinterpretation. n particular, he theorywhich

yields (H) as an implicationshouldnot be rejectedon the basis of these

previousresults.As for thestrongerhypothesis, H*), whilethe resultsofourexperimentdo not providea confirmationof (H*), neitherdo theyre-

ject it: because the experimentseems never to have quite reached an

equilibrium,ts evidenceon thestrongfree riderhypothesiss inconclusive.

6. Concludingremarks

We have describeda numberof 'invalidating actors,' any one of which,if present,could account for the weakness or absence of the free rider

problem n the voluntaryprovisionof a publicgood. Whenany of thesefactors s

present,he free rider

phenomenons not

necessarilyn

implica-tion of economictheory.Theseinvalidatingg actors have been used as a

guide n theconstruction f an experimentwhich,by avoidingall such fac-

tors, shouldexhibit he freeriderphenomenon.The resultsof performingthe experiment ndicatethat the free riderhypothesisshould not be re-

jected. Thecontrastbetween his resultand previousexperimental esultsindicates hat some of the factors we have identifiedwill be important n

attemptingo explain hepresenceor absenceof the free riderphenomenonin any particular ituationin which a publicgood is to be financedby

voluntarymeans.

NOTES

1. It is also worthnotinganimportant ifferencebetweenheexperimentn Isaacetal. (1982)and the onewe areabout o report: heformer xperiment idnot(asoursdid) ncorporate








24

suchfeaturesas a largenumberof participants,ubstantialmonetary ewards,absenceof

transitory ndowments, r non-studentubjects- butthe resultsof the two experimentswerethe same. Thissuggests hat the freeriderphenomenons fairlyrobust,andthat themost importantof the factors we considerbelow is repetitionof the decision-making

situation.2. Thatis, is therea Nashequilibrium tQ,...,

t,)?

3. Aloneamongprevious esearchers,mithdid not interpret isexperimentss a testof (H)as we havedeveloped t. Smith was quite explicitabout the fact that he was testingthe

hypothesisonly undera unanimitymechanism.4. Subjectselectionbeganwitha solicitation ettermailed o fortyindividuals electedran-

domlyfrom thelocaltelephonedirectory.Sixpersonsrespondedbytelephone),of whom

the first five were selected. Two letters were returnedas undeliverable, nd follow-up

telephone allsto theremaining hirty-two evealedhatmost failed o respondbecauseofconflictswithplannedvacationsor withdailyresponsibilities uring omepartof the four

summerweeksthat the solicitation etteraskedthem to be available.Post-experiment

anonymousquestionnairesevealedno concentration f subjectswithrespect o age, sex,income or employed/unemployed/studenttatus.

5. See note 4, above.

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Alfano, G., andMarwell,G. (1978).Experimentsn theprovision f publicgoodsIII:Non-

divisibilityand freeriding n 'real'groupsW.P. #78-1. Social ScienceResearchCenter,

Universityof Wisconsin.

Bohm,P. (1972).Estimating emand or publicgoods:an experiment.EuropeanEconomic

Review3: 111-130.

Isaac,M., McCue,K., andPlott, C. (1982).Nashequilibrian publicgoods provision:Free

ridingin experimentallyontrolledmarkets.CaliforniaInstituteof Technology,Social

ScienceW.P. #428.

Marwell, G., and Ames, R. (1979). Experimentson the provisionof public goods I:

Resources, nterest, roupsize,andthe freeriderproblem.American ournalof Sociology.Marwell,G., andAmes,R. (1980).Experimentsn theprovision f publicgoodII:Provision

points,stakes,experience, nd the free riderproblem.American ournalof Sociology.85:926-937.

Marwell,G., andAmes, R. (1980b).Economists reeride,does anyoneelse?:Experimentsontheprovision f publicgoodsIV. W.P. # 80-1. SocialScienceResearchCenter,Univer-

sity of Wisconsin.Journalof PublicEconomics,1981.

Olson, M. (1975). The logic of collectiveaction. Cambridge,Mass.: HarvardUniversityPress.

Plott, C. (1982).Externalitiesnd corrective olicies n experimentalmarkets.California n-

stituteof Technology,SocialScienceW.P. # 180(1977,revised1982); orthcomingn The

EconomicJournal.

Scherr,B., and Babb, E., (1975). Pricingpublicgoods:An experimentwith two proposedpricingsystems.PublicChoice,23: 35-48.

Smith, V. (1975). Experimental conomics:Induced value theory. American EconomicReview.(PapersandProceedings),pp. 274-279.

Smith, V. (1980).An experimental omparison f threepublicgood decisionmechanisms.The Scandinavianournalof Economics.

Sweeney,J. (1973).An experimentalnvestigation f the free riderproblem.Social ScienceResearch.2: 277-292.

Documents

1984 the Free Rider Problem_Experimental Evidence