Abstract This experimental study introduces a threshold inequality into a classic threshold public goods game to understand coordinating behavior under asymmetric conditions. We use a novel design with “advantaged” players who have a lower threshold than a “disadvantaged” player, reflecting real-world public good scenarios. The threshold inequality disrupts the efficient coordination we observe in the control sessions leading to welfare losses relative to a control group without a disadvantaged player. Threshold inequality creates opportunities to help a disadvantaged player while enabling advantaged players to potentially free ride. We find evidence that threshold inequalities make the Pareto efficient provisioning of public goods more challenging, leading to suboptimal outcomes.
Cavlovic et al. (Wed,) studied this question.