Public goods provision, Ex post efficiency, Participation constraints, Majority voting
Abstract:
It is well known that ex post efficient mechanisms for the provision of indivisible public
goods are not interim individually rational. However, the corresponding literature assumes
that agents who veto a mechanism can enforce a situation in which the public good is
never provided. This paper instead considers majority voting with uniform cost-sharing as
the relevant status quo. Efficient mechanisms may then exist, which also satisfy all agents’
interim participation constraints. In this case, ex post inefficient voting mechanisms can
be replaced by efficient ones without reducing any individual’s expected utility. Intuitively,
agents with a low willingness to pay have to contribute more under majority rule than
under an efficient mechanism with a balanced budget. Although this possibility theorem
is not universal in the sense of Schweizer (2006), an asymptotic possibility is obtained for
certain type distributions.
Dieser Eintrag ist Teil der Universitätsbibliographie.