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Abstract
Mobilizing domestic resources is vital in financing domestic investment and social programmes, which are essential for reducing poverty in developing countries. We consider citizens’ willingness to contribute to public goods as one mechanism for domestic resource mobilization. In particular, we are interested in how willingness to contribute varies on three dimensions: inequality in initial endowments, public good outreach (local vs. national), and the expected impact of giving. We conducted a preregistered (AEARCTR-0007746) online experiment with a sample of 900 respondents in South Africa. First, public goods game tasks with equal and unequal endowments were compared to estimate inequality impacts. Second, a dictator game decision with donations to a national charity was compared to the local public goods game to study the effect of project outreach. Finally, to estimate donation impact, charity decisions with quadrupled contributions were compared to those with doubled contributions. We find overall high levels of contribution, with much overlap across the different contexts considered. We note that the highest endowment proportion is contributed in the unequal context, with low endowment players giving the highest share of their endowments. Response time data shows that decisions take longer where donation impact is higher, and where endowments are unequal, particularly for those receiving lower endowments.
Disclosure statement
No potential conflict of interest was reported by the author(s).
Data availability statement
The data for the study is available from the authors on request.
Notes
1 South Africa entered into the COVID-19 pandemic after several years of slow economic growth. In 2019, the economy grew by 0.2 per cent (in 2018 it was 0.8%) partially caused by the resurgence of electricity outages associated with operational and financial difficulties at the energy utility Eskom. The persistence of the pandemic at the global and domestic levels is expected to constrain the economic recovery (World Bank, Citation2021).
4 Variations of the public goods game include introducing an option to punish non-contributors, with seminal contributions from Ostrom, Walker, and Gardner (Citation1992) and Fehr and Gachter (Citation2000); as well as introducing the role of inequality through different endowments (e.g. Buckley & Croson, Citation2006; Chan et al., Citation1997); and looking at the role of social identity theory (Tajfel, Citation1982) in impacting group members’ willingness to contribute to a group public good (Burns & Keswell, Citation2015).
5 Burns and Visser (Citation2008) proposes a potential mechanism for the higher contributions from unequal groups, and particularly from those with lower endowments in the unequal groups: those with lower initial endowments (poorer) stand to benefit relatively more from the public good than those with higher endowments (wealthier). The higher relative contributions from the low endowment players might represent an attempt at signaling their willingness to cooperate to group members with more resources.
6 Two exceptions are work by Hofmeyr et al. (Citation2007) and Burns and Visser (Citation2008) that examine inequality and contributions in public goods games in South Africa. These studies consider very specific samples; the former uses high school students, and the latter uses fishing communities. In contrast, this study uses a larger and far broader sample in the country.
7 South African gender, race, age and job loss statistics are taken from Statistics South Africa; education statistics are from www.dhet.gov.za. Mean monthly household income in South Africa is estimated at approximately ZAR 14,524 (adjusted for inflation from Statistics South Africa, Citation2018).
8 These calculations were based on the standard deviation seen in the fairly recent South African public goods game experiment of Burns and Keswell (Citation2015). We chose a larger sample so that our statistical tests would be well-powered even if our standard deviations differed from this one.
9 We included an attention check/understanding question to ensure that participants understood this mechanism. Participants who selected an incorrect response to the mechanism description were thanked for their time and terminated from the survey.
10 The questions included a brief description of the Solidarity Fund, similar to that found in this paper.
11 Where the findings from the between- and within-subject analysis approaches differ, we highlight the differences in the main results.
12 This finding cannot be interpreted causally: significant endogeneity is inherent here, since own contributions might be influenced by beliefs about others’ behavior, but reported beliefs about others’ behavior might also be simply based on own behavior.
13 We investigated whether any respondents gave the same contribution across all questions: only three respondents reported the same contribution for all three questions with a R500 endowment.
14 Since respondents answered these questions online, and were not observed, we cannot exclude the possibility that some respondents might have taken longer due to distractions external to the survey. The within-subject nature of our design likely mitigates this concern to some extent. We also note that median decision time measures show the same pattern as the mean measures reported here, suggesting that differences cannot be attributed entirely to individual distracted decision makers.
15 Of course, in this experiment, there would be no strategic benefit to giving more, since decisions are not revealed to other players.
16 The full statements are reported here. Reciprocity: If you treat others well, they will treat you well in return; Trust: Most people can generally be trusted; Selfishness of others: People are generally quite selfish; Take advantage: Most people, if they get the chance, will try to take advantage of you; Beyond self-interest: People should be motivated by something beyond than their own self-interest; Cooperation: It’s better to cooperate than to compete.
17 The few people who reported not understanding each statement are not included in this analysis.
18 The table shows the average percentage given including the 4 decisions made by each participant. When decisions are considered separately for the national Solidarity Fund decisions and for the small group/local decisions, the findings are very similar, with significant differences for the same attitude statements.