Sociality as a Natural Mechanism of Public Goods Provision

In the recent literature, several hypotheses have been offered to explain patterns of human behavior in social environments. In particular, these patterns include ‘prosocial’ ones, such as fairness, cooperation, and collective good provision. Psychologists suggest that these prosocial behaviors are driven not by miscalculations, but by salience of social identity, in-group favoritism, emotion, or evolutionary adaptations. This paper imports psychology scholarship into an economic model and results in a sustainable solution to collective action problems without any external enforcement mechanisms. This natural mechanism of public goods provision is created, analyzed, and observed in a controlled laboratory environment using experimental techniques.