Welfare optimal information structures in public good provision

Christoph Schottmüller

No 104, Working Paper Series in Economics from University of Cologne, Department of Economics

Abstract: This paper studies welfare maximizing information structures in a public good setting. In large groups less information is provided. In the limit, no information is provided but the information is efficient as by the law of large numbers no information is needed to take the efficient decision. This implies that the free rider problem is most severe not for large but for intermediate group sizes.

Date: 2022-11-15
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