Question
Consider a collective action game where each of the 100 members of a community can contribute to the production of a public good. The benefit
Consider a collective action game where each of the 100 members of a community can contribute to the production of a public good. The benefit from the public good, which all individuals in the community receive, is equal to 3n where n is the number of community members who contribute to the project. Individuals who contribute pay a cost of 10. Individuals who do not contribute do not pay this cost of 10, but do suffer a cost in terms of feeling guilty. This "guilt" cost is equal to .025n 2 .
(a) Describe the equilibrium (equilibria) of this game. For each equilibrium, is it stable or not?
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