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Provision of club goods: cost sharing and selection of a provider

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  • Denis Lescop

    (CRESE, Université de Franche Comté)

Abstract

This paper characterizes optimal mechanisms facilitating the cost sharing and the selection of a provider for a club good. These mechanisms are allocatively and Pareto efficient. However, it appears that transfers occur even when the good is not provided. This result is due to the weakening of the incentive notion to Bayesian-Nash equilibrium and to the balanced budget condition. This phenomena disappears if the setting is perfectly symmetric.

Suggested Citation

  • Denis Lescop, 2005. "Provision of club goods: cost sharing and selection of a provider," Economics Bulletin, AccessEcon, vol. 3(25), pages 1-13.
    • Handle: RePEc:ebl:ecbull:eb-05c70015
    as

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    References listed on IDEAS

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    More about this item

    JEL classification:

    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
    • H4 - Public Economics - - Publicly Provided Goods

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