Optimal ownership of public goods under asymmetric information

• 成果类型: Article
• 署名作者: Schmitz, Patrick W.
• 署名单位: University of Cologne; Centre for Economic Policy Research - UK
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/j.jpubeco.2021.104424
• 发表日期: 2021
• 关键词: incomplete contracts; Control rights; public goods; private information; investment incentives

摘要

Consider two parties who can make non-contractible investments in the provision of a public good. Who should own the physical assets needed to provide the public good? In the literature it has been argued that the party who values the public good most should be the owner, regardless of the investment technologies. Yet, this result has been derived under the assumption of symmetric information. We show that technology matters when the negotiations over the provision of the public good take place under asymmetric information. If party A has a better investment technology, ownership by party A can be optimal even when party B has a larger expected valuation of the public good. (c) 2021 Elsevier B.V. All rights reserved.