The idea of a dominant assurance contract is one I wasn't familiar with until this year when I was writing about vaccines. It's a very intriguing concept and now a new experiment suggests that it really could make crowdfunding more effective with better incentives to back a project.
Better Crowdfunding - Marginal REVOLUTION
In 1998, I designed the “dominant assurance contract” (DAC) mechanism for producing public goods privately. In my latest paper, just published in GEB written with the excellent Tim Cason and Robertas Zubrickas we test the theory in the lab and…it works! Kickstarter hadn’t yet been created when I first wrote but the DAC mechanism can […]
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