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Common ownership of public goods

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  • Halonen-Akatwijuka, Maija
  • Pafilis, Evagelos

Abstract

We analyze ownership of public goods in a repeated game focusing on common ownership. Under common ownership an owner’s access to the public good cannot be restricted by other owners. We find that under common ownership both the value of the relationship and the gain from deviation are high. Common ownership can provide the best incentives for cooperation when the value of the public good cannot be increased much by maintenance investments or the maintenance costs are sufficiently convex. We argue that these conditions are satisfied in Ostrom’s field studies of irrigation systems and common lands.

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  • Halonen-Akatwijuka, Maija & Pafilis, Evagelos, 2020. "Common ownership of public goods," Journal of Economic Behavior & Organization, Elsevier, vol. 180(C), pages 555-578.
    • Handle: RePEc:eee:jeborg:v:180:y:2020:i:c:p:555-578
    DOI: 10.1016/j.jebo.2020.10.002
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    Cited by:

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    3. Schmitz, Patrick W., 2023. "The proper scope of government reconsidered: Asymmetric information and incentive contracts," European Economic Review, Elsevier, vol. 157(C).

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    More about this item

    Keywords

    Public goods; Common pool resources; Property rights theory; Relational contracts; Common ownership; Joint ownership;
    All these keywords.

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out

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