Simple Subscription Mechanisms for Excludable Public Goods

Parimal Kanti Bag & Eyal Winter

For excludable public goods, we propose simple mechanisms to uniquely implement a (core) stable and efficient production and cost-sharing outcome: consumers are asked to announce sequentially their minimal requested level of public good and a subscription towards its production. In one mechanism the subscriptions are order-independent and thus symmetric. The equilibrium outcomes induced by our mechanisms are immune to strategic deviations by coalitions. Keywords: Excludable public good, demand-subscription mechanism, implementation, stand alone core, coalition formation, strong equilibrium. Journal of Economic Literature Classification Numbers: H41, C72, D78.

June, 1999
Published in: 
Journal of Economic Theory 1 (1999), 72-94.