133 Irreversibility and Monitoring in Dynamic Games: Experimental Evidence
- Andrew Choi, Syngjoo Choi, Yves Gueron, Eungik Lee
- sier_133.pdf
Abstract
This paper provides experimental evidence on the impacts of irreversibility and
imperfect monitoring on the efficiency and the equity of repeated public goods
game. We find that irreversibility and imperfect monitoring both lead to inefficient
and unequal outcomes through different channels. Irreversibility lowers public
goods contribution in earlier periods and makes the initial-period contribution gap
between two players long-lasting. Imperfect monitoring hampers conditional cooperation
and reduces group contribution persistently. A finite mixture estimation
with conditional cooperator provides a coherent account of the treatment effects.
Keywords: repeated games; dynamic games; imperfect monitoring; irreversibility; cooperation
JEL classification: C73; C91; C92