Full Agreement and the Provision of Threshold Public Goods

Alberti, Federica and Cartwright, Edward (2016) Full Agreement and the Provision of Threshold Public Goods. Public Choice, 166 (1). pp. 205-233. ISSN 0048-5829. E-ISSN 1573-7101. (doi:https://doi.org/10.1007/s11127-016-0321-z) (Full text available)

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http://dx.doi.org/10.1007/s11127-016-0321-z

Abstract

The experimental evidence suggests that groups are inefficient at providing threshold public goods. This inefficiency appears to reflect an inability to coordinate over how to distribute the cost of providing the good. So, why do groups not just split the cost equally? We offer an answer to this question by demonstrating that in a standard threshold public good game there is no collectively rational recommendation. We also demonstrate that if full agreement is required in order to provide the public good then there is a collectively rational recommendation, namely, to split the cost equally. Requiring full agreement may, therefore, increase efficiency in providing threshold public goods. We test this hypothesis experimentally and find support for it.

Item Type: Article
Uncontrolled keywords: Public good, threshold, full agreement, focal point, experiment, coordination
Subjects: H Social Sciences > HB Economic Theory
H Social Sciences > HJ Public Finance
Divisions: Faculties > Social Sciences > School of Economics
Depositing User: Edward Cartwright
Date Deposited: 24 Feb 2016 14:22 UTC
Last Modified: 23 Feb 2017 00:00 UTC
Resource URI: https://kar.kent.ac.uk/id/eprint/54267 (The current URI for this page, for reference purposes)
Cartwright, Edward: https://orcid.org/0000-0003-0194-9368
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