Mechanism Design and Voting for Public-Good Provision

47 Pages Posted: 13 Jan 2012

See all articles by Felix J. Bierbrauer

Felix J. Bierbrauer

Max Planck Society for the Advancement of the Sciences - Max Planck Institute for Research on Collective Goods

Martin F. Hellwig

Max Planck Institute for Research on Collective Goods; University of Bonn - Department of Economics

Date Written: December 1, 2011

Abstract

We propose a new approach to the normative analysis of public-good provision. In addition to individual incentive compatibility, we impose conditions of robust implementability and coalition proofness. Under these additional conditions, participants' contributions can only depend on the level of public-good provision. For a public good that comes as a single indivisible unit, provision can only depend on the population share of people in favor of provision. Robust implementability and coalition proofness thus provide a foundation for the use of voting mechanisms. The analysis is also extended to a specifi cation with more than two public-good provision levels.

Keywords: Mechanism Design, Public-good provision, Large Economy, Voting Mechanisms

JEL Classification: D82, H41, D70, D60

Suggested Citation

Bierbrauer, Felix J. and Hellwig, Martin F., Mechanism Design and Voting for Public-Good Provision (December 1, 2011). MPI Collective Goods Preprint, No. 2011/31. Available at SSRN: https://ssrn.com/abstract=1983939 or http://dx.doi.org/10.2139/ssrn.1983939

Felix J. Bierbrauer

Max Planck Society for the Advancement of the Sciences - Max Planck Institute for Research on Collective Goods ( email )

Kurt-Schumacher-Str. 10
D-53113 Bonn, 53113
Germany

Martin F. Hellwig (Contact Author)

Max Planck Institute for Research on Collective Goods ( email )

Kurt-Schumacher-Str. 10
D-53113 Bonn, 53113
Germany

University of Bonn - Department of Economics

Adenauerallee 24-42
D-53113 Bonn
Germany

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