Do malevolent leaders provoke conflict? An experiment on the paradox of the plenty

Using a laboratory experiment, we study the impact of a sudden increase in the common-pool size on within-group fighting, i.e. the paradox of the plenty. We also consider the role of leader behavior in avoiding this paradox. In the first stage, a randomly chosen leader of the group determines how much of the common-pool resource to protect from second stage conflict. In the next stage, each group member allocates his private endowment between working or fighting for a share of the unprotected resource. We consider two treatments: anarchy (consisting of the second stage only) and leadership. We find that the existence of institutions is not always better than anarchy. This is aggravated when resource size is higher. It is only when leaders are benevolent, i.e. they chose the strongest resource protection in the first stage, that group conflict (in come) is reduced (goes up). When leaders are malevolent, i.e. they chose weak resource protection, outcomes are worse than those under anarchy.