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The Impact of the Number of Participants on the Provision of a Public Good

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  • Hellwig, Martin

Abstract

Under constraints of Bayesian interim incentive compatibility and individual rationality, the paper characterizes second-best allocations for the provision of a public good. If benefit and cost functions do not depend on the number of participants, it is always beneficial to have more participants. As the number of participants becomes large, second-best of public-good provision converge in distribution to first-best levels if these levels are bounded. If public-good provision levels are potentially unbounded, with isoelastic benefit and cost functions, then, with positive probability, second-best provision levels become large in absolute terms, but, relative to first-best levels, they go to zero.

Suggested Citation

  • Hellwig, Martin, 2001. "The Impact of the Number of Participants on the Provision of a Public Good," Papers 01-16, Sonderforschungsbreich 504.
  • Handle: RePEc:mnh:spaper:11680
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    Cited by:

    1. Hans Gersbach, 2009. "Competition of politicians for wages and office," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 33(1), pages 51-71, June.
    2. Martin F. Hellwig, 2003. "Public-Good Provision with Many Participants," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 70(3), pages 589-614.

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