Abstract

We study by means of a laboratory experiment the role of individuals' empathy in the Vote-with-the-Wallet Game. Our main purpose is to analyze the impact of the ability to empathize on participants' behavior when asked to choose between two specific types of product: a cheaper conventional good and a more expensive one which, however, produces a positive externality for the other participants. We consider three manipulations: a) a redistribution mechanism where the expensive product is subsidized by the buyers of the cheaper one; b) a framed version of the game where the expensive good is described as produced by a socially responsible company; c) a treatment where information about other participants' behavior are made public. We find that all the manipulations increase the rate of contribution to the public good with respect to the baseline treatment and that the effects are stronger among participants who show higher levels of empathy.