ContinuousTimeandCommunicationinaPublic-LEEPS.docVIP

Continuous Time and Communication in a Public-goods Experiment Ryan Oprea, Gary Charness and Dan Friedman* September 4, 2014 Abstract: We investigate the nature of continuous time strategic interaction in public-goods games. In one set of treatments, four subjects make contribution decisions in continuous time during a 10-minute interval while in another they make them only at 10 discrete points of time during this interval. The effect of continuous time is muted in public-goods games compared to simpler social dilemmas and the data suggests that widespread coordination problems are to blame. When we add a rich communication protocol, these coordination problems largely disappear and the median subject contributes completely to the public good with no sign of decay over time. At the median, the same communication protocol is less than half as effective in discrete time. Keywords: public goods, voluntary contribution mechanism, continuous time games JEL codes: C72, C92, D70, H41 Acknowledgments: For valuable comments we would like to thank two referees and an Associate Editor of this Journal, as well as Jordi Brandts, David Cooper, Rachel Croson, Martin Dufwenberg, Norman Frohlich, Martin Kocher, Matthias Sutter, Fangfang Tan, Lise Vesterlund, James Walker, and participants at the EWEBE meeting in Munich in October 2011, the North American ESA meeting in Tucson in November 2011, the American Economic Association meeting in January 2012, and the Social Dilemmas conference at Caltech in February 2013. * Oprea: Economics Department, University of California, Santa Barbara, 2127 North Hall, Santa Barbara, CA 93106, roprea@; Charness: Economics Department, University of California, Santa Barbara, 2127 North Hall, Santa Barbara, CA 93106, charness@; Friedman: Economics Department, University of California, Santa Cruz, 401 Engineering 2 Building, 1156 High Street, Santa Cruz, CA 95064, dan@  Introduction The provision of public goods is critical in every society, y