All or nothing: State capacity and optimal public goods provision

• 成果类型: Article
• 署名作者: Bierbrauer, Felix; Winkelmann, Justus
• 署名单位: University of Cologne; University of Bonn
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2019.104955
• 发表日期: 2020
• 关键词: Public goods; bundling; state capacity; mechanism design

摘要

We study public goods provision subject to ex post incentive and participation constraints. We also impose a requirement of anonymity. Different public goods can be bundled if sufficient resources are available. The analysis focuses on the all-or-nothing-mechanism: Expand provision as much as is resource feasible if no one vetoes - otherwise stick to the status quo. We show that the probability of the all-outcome converges to one as the capacity becomes unbounded. For a given finite capacity, we provide conditions under which the all-or-nothing-mechanism is ex ante welfare-maximizing - even though, ex post, it involves an overprovision of public goods. (C) 2019 Elsevier Inc. All rights reserved.