Competition, Cooperation and Collective Choice

• Published in: The Economic journal (London) Vol. 124; no. 574; pp. F163 - F195
• Main Authors: Markussen, Thomas, Reuben, Ernesto, Tyran, Jean-Robert
• Format: Journal Article
• Language: English
• Published: Oxford Blackwell Publishing Ltd 01.02.2014; Wiley-Blackwell; Blackwell; Oxford University Press
• Subjects: Abstimmung; Collectivism; Competition; Consolidated financial statements; Cooperation; Coopetition; Decision making; Economic competition; Extensives Spiel; FEATURE: POLITICAL ECONOMY EXPERIMENTS; Group dynamics; Kooperation; Majority rule; Majority voting; Neue politische Ökonomie; Payments; Public goods; Risk aversion; Studies; Theorie; Vetoes; Voting; Voting behavior; Voting rules; Wettbewerb; Öffentliche Güter
• ISSN: 0013-0133; 1468-0297; 1468-0297
• DOI: 10.1111/ecoj.12096

The ability of groups to implement efficiency-enhancing institutions is emerging as a central theme of research in economics. This study explores voting on a scheme of intergroup competition, which facilitates cooperation in a social dilemma situation. Experimental results show that the competitive scheme fosters cooperation. Competition is popular but the electoral outcome depends strongly on specific voting rules of institutional choice. If the majority decide, competition is almost always adopted. If likely losers from competition have veto power, it is often not, and substantial gains in efficiency are foregone.