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The Efficient and Fair Approval of “Multiple‐Cost‐Single‐Benefit” Projects under Unilateral Information

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  • NAVA KAHANA
  • YOSEF MEALEM
  • SHMUEL NITZAN

Abstract

This paper focuses on indivisible “multiple‐cost‐single‐benefit” projects that must be approved by the government. A simple mechanism is proposed that ensures an efficient and fair implementation of such projects. The proposed mechanism is appropriate for a unilateral information structure: the single beneficiary has complete information on the cost and benefit of the project while the government official has no such information and the cost bearers have information only on each other's costs.

Suggested Citation

  • Nava Kahana & Yosef Mealem & Shmuel Nitzan, 2009. "The Efficient and Fair Approval of “Multiple‐Cost‐Single‐Benefit” Projects under Unilateral Information," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 11(6), pages 947-960, December.
    • Handle: RePEc:bla:jpbect:v:11:y:2009:i:6:p:947-960
    DOI: 10.1111/j.1467-9779.2009.01440.x
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    More about this item

    JEL classification:

    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation

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