TY - JOUR AU - Spencer,Michael A. AU - Swallow,Stephen K. AU - Shogren,Jason F. AU - List,John A. TI - Rebate Rules in Threshold Public Good Provision JF - National Bureau of Economic Research Working Paper Series VL - No. 14559 PY - 2008 Y2 - December 2008 UR - http://www.nber.org/papers/w14559 L1 - http://www.nber.org/papers/w14559.pdf N1 - Author contact info: Michael A. Spencer Department of Economics Minnesota State University-Mankato 150 Morris Hall Mankato, MN 56001 E-Mail: michael.spencer@mnsu.edu Stephen K. Swallow Department of Environmental and Natural Resource Economics University of Rhode Island Kingston Coastal Institute Building 1 Greenhouse Road Kingston, RI 02881 E-Mail: swallow@uri.edu Jason Shogren Department of Economics and Finance College of Business University of Wyoming P.O. Box 3985 Laramie, WY 82071-3985 Tel: 307/766-2178 Fax: 307/766-5090 E-Mail: Jramses@UWYO.EDU John List Department of Economics University of Chicago 1126 East 59th Chicago, IL 60637 Tel: 301/405-1288 Fax: 301/314-9091 E-Mail: jlist@uchicago.edu AB - This paper considers how six alternative rebate rules affect voluntary contributions in a threshold public-good experiment. The rules differ by (1) whether an individual can receive a proportional rebate of excess contributions, a winner-takes-all of any excess contributions, or a full rebate of one's contribution in the event the public good is provided and excess contributions exist, and (2) whether the probability of receiving a rebate is proportional to an individual's contribution relative to total contributions or is a simple uniform probability distribution set by the number of contributors. The paper adds to the existing experimental economics literature on threshold public goods by investigating both aggregate and individual demand revelation under the winner-take-all and random full-rebate rules. Half of the rules (proportional rebate, winner-take-all with uniform probability among all group members, and random full-rebate with uniform probability) provide total contributions that nearly equal total benefits, while the rest (winner-take-all with proportional probability, winner-take-all with uniform probability among contributors only, and random full-rebate with proportional probability) exceed benefits by over 30 percent. Only the proportional rebate rule is found to achieve both aggregate and individual demand revelation. Our experimental results have implications for both fundraisers and valuation practitioners. ER -