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Contributing or Free-Riding? Voluntary Participation in a Public Good Economy

Taiji Furusawa () and Hideo Konishi ()

Discussion papers from Research Institute of Economy, Trade and Industry (RIETI)

Abstract: We consider a (pure) public goods provision problem with voluntary participation in a quasi-linear economy. We propose a new hybrid solution concept, the free-riding-proof core (FRP-Core), which endogenously determines a contribution group, public goods provision level, and how to share the provision costs. The FRP-Core is always nonempty in public goods economies but does not usually achieve global efficiency. The FRP-Core has support from both cooperative and noncooperative games. In particular, it is equivalent to the set of perfectly coalition-proof Nash equilibria (Bernheim, Peleg, and Whinston, 1987) of a dynamic game with players' participation decisions followed by a common agency game of public goods provision.

Pages: 54 pages
Date: 2011-03
New Economics Papers: this item is included in nep-gth, nep-pbe and nep-pol
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https://www.rieti.go.jp/jp/publications/dp/11e028.pdf (application/pdf)

Related works:
Journal Article: Contributing or free-riding? Voluntary participation in a public good economy (2011) Downloads
Working Paper: Contributing or Free-Riding? Voluntary Participation in a Public Good Economy (2010) Downloads
Working Paper: Contributing or Free-Riding? Voluntary Participation in a Public Good Economy (2010) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:eti:dpaper:11028

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