TY - JOUR

T1 - Everyone is a winner

T2 - Promoting cooperation through all-can-win intergroup competition

AU - Reuben, Ernesto

AU - Tyran, Jean-Robert

N1 - JEL classification: H41, M52, C92

PY - 2010

Y1 - 2010

N2 - We test if cooperation is promoted by rank-order competition between groups in which all groups can be ranked first, i.e. when everyone can be a winner. This type of rank-order competition has the advantage that it can eliminate the negative externality a group's performance imposes on other groups. However, it has the disadvantage that incentives to outperform others are absent, and therefore it does not eliminate equilibria where all groups cooperate at an equal but low level. We find that all-can-win competition produces a universal increase in cooperation and benefits a majority of individuals if the incentive to compete is sharp.

AB - We test if cooperation is promoted by rank-order competition between groups in which all groups can be ranked first, i.e. when everyone can be a winner. This type of rank-order competition has the advantage that it can eliminate the negative externality a group's performance imposes on other groups. However, it has the disadvantage that incentives to outperform others are absent, and therefore it does not eliminate equilibria where all groups cooperate at an equal but low level. We find that all-can-win competition produces a universal increase in cooperation and benefits a majority of individuals if the incentive to compete is sharp.

KW - Faculty of Social Sciences

KW - public goods

KW - experiment

U2 - 10.1016/j.ejpoleco.2009.10.002

DO - 10.1016/j.ejpoleco.2009.10.002

M3 - Journal article

VL - 26

SP - 25

EP - 35

JO - European Journal of Political Economy

JF - European Journal of Political Economy

SN - 0176-2680

IS - 1

ER -