Self-reliance crowds out group cooperation and increases wealth inequality

Human cooperation enables the establishment of public goods crucial for shared needs like safety and healthcare. Public goods, however, present a social dilemma: reliance on individual contributions while consumption is unrestricted. This non-excludability invites free-riding, potentially hindering public goods provision. Existing research focuses on addressing free-riding, neglecting the impact of self-reliance – the ability to solve shared problems independently. Self-reliance offers an alternative to cooperation, raising the dilemma of individual versus group problem-solving. Prior research suggests that the availability of local goods can reduce global public goods provision, but whether this stems from increased free-riding or a preference for self-reliance remains unclear. This study explores how self-reliance affects cooperation, especially in scenarios with asymmetric self-reliance, impacting social welfare and wealth distribution. The researchers hypothesize that the ability to be self-reliant reduces efficient public goods provision, and that asymmetries in self-reliance amplify wealth inequality and undermine support for communal solutions. They introduce a framework to analyze cooperation when some group members depend on public goods while others can be self-reliant, using a stylized collective action problem.

The paper reviews existing literature on mechanisms to solve free-riding in public goods games, such as punishment, partner choice, and long-term interactions. It highlights the gap in research regarding the impact of self-reliance on cooperation. While the availability of local goods has been shown to potentially reduce global public good provision, the underlying reasons—free-riding versus self-reliance—remain unclear. The literature also discusses asymmetries in public goods provision problems, arising from differing resource distributions or member productivity, but the influence of asymmetric self-reliance on public goods provision has not been fully investigated. The authors cite several previous studies on public goods games, coordination problems, and the impact of resource inequality on cooperation, noting some mixed results.

The researchers conducted a laboratory experiment to investigate the effects of self-reliance on cooperation. Participants, forming groups of four, were tasked with allocating resources to either a private or a public pool to solve a shared problem. The private solution benefited only the individual, while the public solution, requiring sufficient total contributions, benefited all group members. The cost of the private solution was manipulated across different blocks of 10 rounds, allowing for varying degrees of self-reliance. Two experimental conditions were implemented: a symmetry condition where all group members had equal resources, and an asymmetry condition where two members had higher resource endowments than the other two. This created an asymmetry in their ability to be self-reliant. The experiment comprised 50 rounds across five blocks, with varying private solution costs. The study used a 2 (symmetry vs. asymmetry) × 5 (cost of private solution) × 10 (repeated measures) experimental design. Data were analyzed using mixed-effects regression, cluster-adjusted χ²-square tests, Mann–Whitney U-tests, and Wilcoxon signed-rank tests. A separate task measured participants' social value orientation to assess their prosocial preferences. Finally, a third-party delegation mechanism was introduced, where group members voted on whether to delegate their decisions to a third party to assess the groups' willingness to forgo their autonomy in solving their shared problem.

The results showed a significant decline in cooperation (public goods creation) as the cost of the private solution decreased. In the symmetry condition, cooperation completely vanished when the private solution was cheap. However, even in the asymmetry condition, where some members were more reliant on cooperation, cooperation decreased with decreasing private solution costs, although not as drastically. In the asymmetry condition, less dependent group members often opted for private solutions, even when they could contribute to the public good, leading to a self-enforcing exploitation dynamic. More dependent members invested more in cooperation, but faced a higher risk of losing all their resources due to the insufficient contributions from less dependent members. This unequal resource distribution and exploitation led to increased wealth inequality. Less dependent members' decisions were influenced by their social preferences; less prosocial individuals contributed less to the public good. Regarding third-party delegation, more dependent members were more likely to favor delegation, while less dependent members less so. Third parties favored more communal solutions, lowered wealth inequality, and favored public goods provision compared to the groups themselves. Therefore, the voting of the two types of members reflect their self-interest, and illustrates how the option for self-reliance can lead to negative consequences for the group as a whole.

The findings demonstrate a novel social dilemma of self-reliance, showing that the ability to solve shared problems individually can undermine cooperation and increase wealth inequality. The decrease in cooperation as self-reliance becomes cheaper mirrors findings that show that people prefer local goods over global public goods. The research highlights the impact of asymmetric self-reliance on social welfare and wealth distribution, emphasizing the importance of considering the interdependence structure within groups. The results suggest that providing private solutions alongside public goods can disproportionately benefit the affluent, exacerbating existing inequalities, which has implications for policies in areas such as healthcare and social security, where both public and private options exist.

This research introduces the concept of a social dilemma of self-reliance, revealing how the option of independent problem-solving can negatively affect collective action. The findings highlight the detrimental effects of asymmetric self-reliance on cooperation, wealth distribution, and social welfare. Future research could explore how different institutional designs, such as regulations or incentives, could mitigate the negative consequences of self-reliance while preserving individual freedoms. Additional research could examine how these findings generalize to real-world settings with different types of shared problems and diverse societal structures.

The study's laboratory setting might not fully reflect the complexities of real-world social interactions. The simplified nature of the experimental task could limit the generalizability of the findings to more nuanced collective action problems. The sample size may also affect the study's ability to capture more subtle behavioral patterns within the two groups, although the authors claim that the sample was of sufficient size.