Anonymous Contributions as Reciprocating Behaviors: a Model with Subjective Thresholds

We present a model of social reciprocity in which anonymous agents decide to contribute fairly if and only if the observed level of public good is greater than their personal threshold. The main results of the model can be summarized as follows: a) the equilibrium level of public good is higher than what implied by the traditional models; b) an exogenous donation may trigger a process of “motivational crowding-in,” with a multiplier effect on the equilibrium level of public good; c) when the size of the population increases, the set of positive contributors does not necessarily converge to the set of individuals with the highest preferences for the public good.