Public goods experiment with default options.

• Main Authors: Teh, Jackson Wah Yock., Ng, Yee Theng., Tan, Hong Yue.
• Other Authors: School of Humanities and Social Sciences
• Format: Final Year Project
• Language: English
• Published: 2011
• Subjects: DRNTU::Social sciences::Economic theory
• Online Access: http://hdl.handle.net/10356/44311
• Institution: Nanyang Technological University

Traditional economic theory postulates that rational homo economicus are self interested and are only concerned with maximising their own utility. This means that they should act indifferently and opt towards the same eventual outcome albeit given different initial default options. However, outcome differences had been observed in a variety of domains. This has attracted many economists, who have realised that these differences could have serious implications for economic theory and policy formulation. Our paper seeks to investigate contribution variations in public good games with different initial default options. This was done through experimental games conducted in laboratories at Nanyang Technological University. We find that differences in contribution rates are persistent, with higher rates elicited for the opt-out treatment scenario. This reaffirms the conclusions of many similar studies.