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Pledges of commitment and cooperation in partnerships


Deer, Lachlan; Bayer, Ralph-C (2015). Pledges of commitment and cooperation in partnerships. Working paper series / Department of Economics 201, University of Zurich.

Abstract

We use experimental methods to investigate whether pledges of commitment can improve cooperation in endogenously formed partnerships facing a social dilemma. Treatments vary in terms of the individual’s (a) opportunity to commit to their partner, (b) the cost of dissolving committed partnerships, and (c) the distribution of these dissolution costs between partners. Our findings show that pledges of commitment alone can increase cooperation and welfare in committed partnerships . The introduction of relatively large and equally split costs yields similar gains. In contrast, when costs to dissolve committed partnerships fall solely on the individual choosing to break up, pledges of commitment fail to improve cooperation and welfare.

Abstract

We use experimental methods to investigate whether pledges of commitment can improve cooperation in endogenously formed partnerships facing a social dilemma. Treatments vary in terms of the individual’s (a) opportunity to commit to their partner, (b) the cost of dissolving committed partnerships, and (c) the distribution of these dissolution costs between partners. Our findings show that pledges of commitment alone can increase cooperation and welfare in committed partnerships . The introduction of relatively large and equally split costs yields similar gains. In contrast, when costs to dissolve committed partnerships fall solely on the individual choosing to break up, pledges of commitment fail to improve cooperation and welfare.

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Additional indexing

Item Type:Working Paper
Communities & Collections:03 Faculty of Economics > Department of Economics
Working Paper Series > Department of Economics
Dewey Decimal Classification:330 Economics
JEL Classification:C92, D03, D83, H41
Uncontrolled Keywords:Commitment, cooperation, endogenous group formation, experiment
Language:English
Date:December 2015
Deposited On:22 Jul 2015 13:26
Last Modified:16 Aug 2017 10:52
Series Name:Working paper series / Department of Economics
Number of Pages:24
ISSN:1664-7041
Additional Information:Revised version
Official URL:http://www.econ.uzh.ch/static/wp/econwp201.pdf
Related URLs:http://www.econ.uzh.ch/static/workingpapers.php

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