Foreign aid and weakest-link international public goods: An experimental study

摘要

In this paper, we investigate efficiency differences between income and in-kind transfers asdistribution mechanisms of foreign aid to weakest-link international public goods in a laboratoryenvironment. We find that if there is relatively small difference in country size, then income transfersseem to provide a higher provision of the international public good, and thus higher overall welfarelevel than that of in-kind transfers. However, if there is a large disparity in country size, then in-kindtransfers appear to provide a higher level of IPG provision and higher accompanying global welfare.