Agreements with reciprocity: Co-financing and MOUs

• 成果类型: Article
• 署名作者: Jang, Dooseok; Patel, Amrish; Dufwenberg, Martin
• 署名单位: Korea Advanced Institute of Science & Technology (KAIST); University of East Anglia; University of Arizona; University of Gothenburg; Leibniz Association; Ifo Institut
• 刊物名称: GAMES AND ECONOMIC BEHAVIOR
• ISSN/ISSBN: 0899-8256
• DOI: 10.1016/j.geb.2018.06.004
• 发表日期: 2018
• 页码: 85-99
• 关键词: Co-financing agreements; Gentlemen's agreements; MOUs; public goods; RECIPROCITY

摘要

Institutions for co-financing agreements often exist to encourage public good investment. Can such frameworks deliver maximal investment when agents are motivated by reciprocity? We demonstrate that indeed they can, but not how one might expect. If maximal investment is impossible in the absence of the institution and public good returns are high, then an agreement signed by all parties cannot lead to full investment. However, if all parties reject the agreement, then full investment is attainable via a gentlemen's agreement or memorandum of understanding (MOU). Agreement institutions may thus do more than just facilitate the signing of binding agreements; they may play a critical role in igniting informal cooperation underpinned by reciprocity. (C) 2018 Elsevier Inc. All rights reserved.