Pareto improvement through unilateral matching of public good contributions: The role of commitment

Wolfgang Buchholz (), Richard Cornes, Wolfgang Peters and Dirk Rübbelke

Economics Letters, 2015, vol. 132, issue C, 9-12

Abstract: When providing public goods through voluntary contributions, a donor may introduce unilateral matching in order to reduce underprovision of the public good and thus inefficiency. By itself, however, matching benefits the donor but harms the recipient. We apply Cornes and Hartley’s aggregative game approach to provide a novel graphical explanation of this transfer paradox, and also show how it may be avoided by introducing a commitment device.

Keywords: Voluntary public good provision; Matching; Commitment (search for similar items in EconPapers)
JEL-codes: H23 H41 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Working Paper: Pareto Improvement through Unilateral Matching of Public Good Contributions: The Role of Commitment (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:132:y:2015:i:c:p:9-12

DOI: 10.1016/j.econlet.2015.04.003

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