Inequality, institutions and cooperation

Publikation: Bidrag til tidsskriftTidsskriftartikelForskningfagfællebedømt

We examine whether the relationship between economic inequality and voluntary cooperation isinfluenced by the quality of local institutions, as proxied by corruption. We use representativedata from a large-scale lab-in-the-field public goods experiment with over 1,300 participantsacross rural Vietnam. Our results show that inequality adversely affects aggregate contributionsdue to high endowment individuals contributing a significantly smaller share than those withlow endowments. This negative effect of inequality on cooperation is stronger in high corruptionenvironments. We find that corruption is associated with pessimistic beliefs about others’contributions in heterogeneous groups, highlighting the indirect costs of corruption that areunderstudied in the literature. These findings have implications for public policies aimed atresolving local collective action problems.
OriginalsprogEngelsk
Artikelnummer103842
TidsskriftEuropean Economic Review
Vol/bind138
ISSN0014-2921
DOI
StatusUdgivet - sep. 2021

Bibliografisk note

Funding Information:
We thank an associate editor of the European Economic Review and two anonymous reviewers, Abigail Barr, Utteeyo Dasgupta, Dietmar Fehr, Subha Mani, Oliver Morrissey, Danila Serra, Joseph Vecci, Eyal Winter, and seminar participants at University of Namur, University of Nottingham, University of Kent, University College Dublin, University of Reading, Indian Statistical Institute, University of Hong Kong, Singapore Management University, Newcastle University, UNU-WIDER, and conference participants at DIW Berlin, Nordic Conference in Development Economics 2019, Workshop on Social Economy 2019 and DIAL Conference 2019 for helpful comments. Hoang Diem provided excellent research assistance. We are grateful to the survey teams from Central Institute for Economic Management, Vietnam and to various commune officials for supporting the data collection. Funding under Novo Nordisk Foundation grant number NNF19SA0060072 , Denmark is acknowledged. We also thank UNU-WIDER for support. These institutions had no involvement in study design, data collection, analysis, or interpretation. The usual caveats apply.

Funding Information:
We thank an associate editor of the European Economic Review and two anonymous reviewers, Abigail Barr, Utteeyo Dasgupta, Dietmar Fehr, Subha Mani, Oliver Morrissey, Danila Serra, Joseph Vecci, Eyal Winter, and seminar participants at University of Namur, University of Nottingham, University of Kent, University College Dublin, University of Reading, Indian Statistical Institute, University of Hong Kong, Singapore Management University, Newcastle University, UNU-WIDER, and conference participants at DIW Berlin, Nordic Conference in Development Economics 2019, Workshop on Social Economy 2019 and DIAL Conference 2019 for helpful comments. Hoang Diem provided excellent research assistance. We are grateful to the survey teams from Central Institute for Economic Management, Vietnam and to various commune officials for supporting the data collection. Funding under Novo Nordisk Foundation grant number NNF19SA0060072, Denmark is acknowledged. We also thank UNU-WIDER for support. These institutions had no involvement in study design, data collection, analysis, or interpretation. The usual caveats apply.

Publisher Copyright:
© 2021

ID: 279196092