Do incentives for leaders improve group cooperation?

초록

When a group with a designated leader undertakes a project involving a social dilemma, the leader may be paid a bonus conditional upon the group’s performance. This study examines how additional incentives for leaders affect group contributions and overall welfare. We conducted a laboratory experiment using sequential voluntary contribution games with and without additional incentives for the leader; each participant played both games. Our results provide a rationale for using these additional incentives in that they increase group contributions and welfare. We also investigated whether information about the incentives was private (only known to the leader) or public. A social crowding-out effect occurs when the followers are aware that the leader receives additional incentives. However, if the leader increases their contributions sufficiently, this increase can offset the social crowding- out effect, resulting in a net improvement in group welfare.

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