The Pivotal Mechanism Versus the Voluntary Contribution Mechanism: An Experimental Comparison


We conduct an experimental comparison of two well-known mechanisms for undertaking a binary public project: the pivotal mechanism and the voluntary contribution mechanism. We compare the two mechanisms under complete information in which each subject knows the other subjects'payoffs. We then observe that the voluntary contribution mechanism works better than the pivotal mechanism from the perspectives of Pareto efficiency and individual rationality. On the other hand, we observe that the pivotal mechanism works better than the voluntary contribution mechanism in light of decision efficiency. These results suggest that whenever we insist on either Pareto efficiency or individual rationality, the voluntary contribution mechanism is more favorable than the pivotal mechanism in practical applications.


Laboratory experiment; Pivotal mechanism; Voluntary contribution mechanism

JEL Classification

C92; D71; D78; H41


Tatsuki HOMMA
Graduate School of Decision Science and Technology, Tokyo Institute of Technology

Junyi SHEN
Research Institute for Economics and Business Administration,
Kobe University
Rokkodai-cho, Nada-ku, Kobe
657-8501 Japan
Phone: +81-78-803-7036
FAX: +81-78-803-7059
School of Economics, Shanghai University, China

Faculty of Economics, Ryukoku University

Department of Law and Economics, School of Economics, Hokusei Gakuen University

Takehiko YAMATO
Department of Industrial Engineering and Economics, School of Engineering, Tokyo Institute of Technology