Social scientists ran an experiment called the public good game. A participant along with nine strangers are given five one-dollar bills, they are told that they can keep all of them and take them home. Alternatively, they could also contribute anonymously any of the dollars to a “public good pot.” Each dollar contributed will be doubled by the experimenters, and then the pot will be divided equally among the ten players. If everyone contributes all five dollars, everyone takes home ten dollars.
If you are one of the participants how much would you contribute? Would the result change if the stakes were increased by a thousand or tens of thousands?
If you contribute one dollar, the public good pot grows by two dollars which you will get your share of twenty cents. The more you contribute to the public good pot, the less you will take home. But if everyone contributes, the more everyone will get. If everyone contributes, everyone doubles their money!
So, will you be selfish and get benefits from everyone else, or will you be generous and believe in the public good?
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The result of this experiment after being played thousands of times turns out that people are not as selfish as economists thought them to be. The prediction that no one will donate anything is wrong. The good news is, on…
