View article

This study presents novel evidence showing that group payments distributed proportional to effort are as effective as payments targeted to individuals in increasing public good provision. The decision setting includes donors who make transfer payments to public good providers. The institutions under consideration are motivated primarily by payments for ecosystem services (PES), such as payments for climate protection. The decision settings, however, capture attributes of many forms of charitable giving where NGO type organizations support activities that provide public good externalities beyond those who directly benefit. Results are presented from two studies, varying the sharing rules for transfers among group members (equal share, proportional share, and individual targeting) and the presence of additionality, whereby transfers are received contingent on public good provision being at a level higher than in …