An experimental study on voluntary vs. compulsory provision of public goods under the vote-with-feet mechanism

This paper conducts laboratory experiments to investigate how the individuals with heterogeneous income levels endogenously select the institution in public good provision in a Tiebout-like environment. According to the experimental results, I find that heterogeneous individuals have different choices of contribution institutions. High-income individuals tend to participate in the voluntary contribution institution, but low-income individuals tend to choose the compulsory one. I also find that most high-income individuals in the voluntary contribution institution try to free ride on others. Therefore, although the vote-with-feet mechanism helps to sort heterogeneous individuals in different contribution institutions, it may not enhance the cooperation among the individuals in the voluntary contribution community.