The Provision and Pricing of Excludable Public Goods: Ramsey-Boiteux Pricing versus Bundling

Martin Hellwig

No 2006_21, Discussion Paper Series of the Max Planck Institute for Research on Collective Goods from Max Planck Institute for Research on Collective Goods

Abstract: This paper studies the relation between Bayesian mechanism design and the Ramsey-Boiteux approach to the provision and pricing of excludable public goods. For a large economy with private information about individual preferences, the two approaches are shown to be equivalent if and only if, in addition to incentive compatibility and participation constraints, the .nal allocation of private-good consumption and admission tickets to public goods satis.es a condition of renegotiation proofness. Without this condition, a mechanism involving mixed bundling, i.e. combination tickets at a discount, is superior.

Keywords: Mechanism Design; Excludable Public Goods; Ramsey-Boiteux Pricing; Renegotiation Proofness; Bundling (search for similar items in EconPapers)
JEL-codes: D61 H21 H41 H42 (search for similar items in EconPapers)
Pages: 49 pages
Date: 2006-09
New Economics Papers: this item is included in nep-cdm, nep-mic and nep-pbe
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Journal Article: The provision and pricing of excludable public goods: Ramsey-Boiteux pricing versus bundling (2007)
Working Paper: The Provision and Pricing of Excludable Public Goods: Ramsey-Boiteux Pricing versus Bundling (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:mpg:wpaper:2006_21

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