Serial cost sharing of excludable public goods: general cost functions

James Dearden ()

Economic Theory, 1998, vol. 12, issue 1, 189-198

Abstract: A group of individuals meet to share the cost and determine output allocations of a partial-excludable public good. We demonstrate that, for general cost functions and preferences that satisfy the Spence-Mirlees sorting condition, the serial cost-sharing formula (Moulin, 1994) has remarkable incentive properties. First, a direct economic mechanism that uses the serial formula is coalition strategy-proof, envy-free and satisfies the stand-alone property. Second, the serial mechanism involves partial exclusion, which is important for the reduction of the free-rider problem.

JEL-codes: C72 D71 D82 (search for similar items in EconPapers)
Date: 1998-06-16
Note: Received: June 10, 1996; revised version; February 11, 1997
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Citations: View citations in EconPapers (6)

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