IDEAS home Printed from https://ideas.repec.org/a/bla/jpbect/v9y2007i3p425-449.html

A Case for Bundling Public Goods Contributions

Author

Listed:
  • SUMAN GHOSH
  • ALEXANDER KARAIVANOV
  • MANDAR OAK

Abstract

We extend the model of voluntary contributions to multiple public goods by allowing for bundling of the public goods. Specifically, we study the case where agents contribute into a common pool which is then allocated toward the financing of two pure public goods. We explore the welfare implications of allowing for such bundling vis‐à‐vis a separate contributions scheme. We show that for high income inequality or for identical preferences among agents bundling leads to higher joint welfare. Interestingly, a welfare improvement can in some cases occur despite a decrease in total contributions. On the contrary, when agents are heterogenous, for low income inequality bundling can lead to lower total contributions and may decrease welfare compared to a separate contribution scheme. Our findings have implications for the design of charitable institutions and international aid agencies.

Suggested Citation

  • Suman Ghosh & Alexander Karaivanov & Mandar Oak, 2007. "A Case for Bundling Public Goods Contributions," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 9(3), pages 425-449, June.
    • Handle: RePEc:bla:jpbect:v:9:y:2007:i:3:p:425-449
    DOI: 10.1111/j.1467-9779.2007.00313.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1467-9779.2007.00313.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1467-9779.2007.00313.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Hanming Fang & Peter Norman, 2003. "An Efficiency Rationale for Bundling of Public Goods," Cowles Foundation Discussion Papers 1441, Cowles Foundation for Research in Economics, Yale University.
    2. Dreze, Jean & Sen, Amartya, 1999. "India: Economic Development and Social Opportunity," OUP Catalogue, Oxford University Press, number 9780198295280.
    3. Richard Cornes & Juni-ichi Itaya, 2004. "Models With Two Or More Public Goods," Department of Economics - Working Papers Series 896, The University of Melbourne.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Daniel A Brent & Nathan W Chan, 2019. "Local Public Goods and the Crowding-out Hypothesis: Evidence from Civic Crowdfunding," Economics Bulletin, AccessEcon, vol. 39(3), pages 2142-2154.
    2. Kundu, Rajendra P. & Pandey, Siddhigyan, 2021. "Multiple Public Goods In Networks," Working Papers 21/345, National Institute of Public Finance and Policy.
    3. Clive D. Fraser, 2022. "Faith? Hope? Charity? Religion explains giving when warm glow and impure altruism do not," Manchester School, University of Manchester, vol. 90(5), pages 500-523, September.
    4. Luca Corazzini & Christopher Cotton & Paola Valbonesi, 2013. "Too many charities? Insight from an experiment with multiple public goods and contribution thresholds," "Marco Fanno" Working Papers 0171, Dipartimento di Scienze Economiche "Marco Fanno".
    5. Heywood, John S. & Li, Dongyang & Ye, Guangliang, 2023. "Private provision of price excludable public goods by rivals," Journal of Economic Behavior & Organization, Elsevier, vol. 214(C), pages 291-307.
    6. Eckel, Catherine & Guney, Begum & Uler, Neslihan, 2020. "Independent vs. Coordinated Fundraising: Understanding the Role of Information," European Economic Review, Elsevier, vol. 127(C).
    7. Tilak Sanyal, 2016. "Pareto Improving Redistribution in the Case of Private Provision of Multiple Pure Public Goods," South Asian Journal of Macroeconomics and Public Finance, , vol. 5(2), pages 220-230, December.
    8. Corazzini, Luca & Cotton, Christopher & Valbonesi, Paola, 2015. "Donor coordination in project funding: Evidence from a threshold public goods experiment," Journal of Public Economics, Elsevier, vol. 128(C), pages 16-29.
    9. Garth Heutel, 2014. "Crowding Out and Crowding In of Private Donations and Government Grants," Public Finance Review, , vol. 42(2), pages 143-175, March.
    10. Jun-ichi Itaya & Atsue Mizushima, 2016. "Should Income Inequality be Praised? Multiple Public Goods Provision, Income Distribution and Social Welfare," CESifo Working Paper Series 6215, CESifo.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. repec:fal:wpaper:05005 is not listed on IDEAS
    2. repec:qeh:ophiwp:ophiwp008 is not listed on IDEAS
    3. Aurino, Elisabetta & Fledderjohann, Jasmine & Vellakkal, Sukumar, 2019. "Inequalities in adolescent learning: Does the timing and persistence of food insecurity at home matter?," Economics of Education Review, Elsevier, vol. 70(C), pages 94-108.
    4. Martin Hellwig, 2004. "Optimal Income Taxation, Public-Goods Provision and Public-Sector Pricing: A Contribution to the Foundations of Public Economics," Discussion Paper Series of the Max Planck Institute for Research on Collective Goods 2004_14, Max Planck Institute for Research on Collective Goods.
    5. Li, Manlin, 2015. "Exploring the impact of New Resettlement Area’s on the well-being of local residents: a case study in Chongqing, China," SocArXiv ht465_v1, Center for Open Science.
    6. Fanyu Chen & Zi Wen Vivien Wong & Siong Hook Law, 2024. "Brain drain: what is the role of institutions?," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 51(3), pages 605-628, September.
    7. Hanming Fang & Peter Norman, 2011. "Corrigendum: Optimal Provision of Multiple Excludable Public Goods," American Economic Journal: Microeconomics, American Economic Association, vol. 3(1), pages 328-328, February.
    8. Tilak Sanyal & Vivekananda Mukherjee, 2019. "On General and Specific Transfers for Child Support in Divorce," Journal of Quantitative Economics, Springer;The Indian Econometric Society (TIES), vol. 17(1), pages 197-213, March.
    9. Naresh Kumar & Ritu Rani, 2019. "Regional Disparities in Social Development: Evidence from States and Union Territories of India," South Asian Survey, , vol. 26(1), pages 1-27, March.
    10. Kartik Misra, 2019. "No Employment without Participation : An Evaluation of India's Employment Program in Eastern Uttar Pradesh," UMASS Amherst Economics Working Papers 2019-13, University of Massachusetts Amherst, Department of Economics.
    11. Li, Manlin, 2015. "Exploring the impact of New Resettlement Area’s on the well-being of local residents: a case study in Chongqing, China," OSF Preprints ht465, Center for Open Science.
    12. Boadway, Robin & Song, Zhen & Tremblay, Jean-Francois, 2007. "Commitment and matching contributions to public goods," Journal of Public Economics, Elsevier, vol. 91(9), pages 1664-1683, September.
    13. Sangita Das, 2023. "Inequality in Educational Attainment: Urban-Rural Comparison in the Indian Context," Papers 2307.16238, arXiv.org, revised Oct 2024.
    14. Karen Pittel & Dirk T.G. Rübbelke, 2006. "Private provision of public goods: incentives for donations," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 33(6), pages 497-519, November.
    15. Matsushima, Hitoshi & Miyazaki, Koichi & Yagi, Nobuyuki, 2010. "Role of linking mechanisms in multitask agency with hidden information," Journal of Economic Theory, Elsevier, vol. 145(6), pages 2241-2259, November.
    16. Toshihiro Ihori & Martin McGuireb, 2008. "National Adversity: Managing Insurance and Protection," CIRJE F-Series CIRJE-F-554, CIRJE, Faculty of Economics, University of Tokyo.
    17. Hellwig, Martin F., 2005. "A utilitarian approach to the provision and pricing of excludable public goods," Journal of Public Economics, Elsevier, vol. 89(11-12), pages 1981-2003, December.
    18. Feng Deng, 2008. "From property rights to urban institutions: an economic analysis of China's emerging urban institutions," Post-Communist Economies, Taylor & Francis Journals, vol. 20(3), pages 347-361.
    19. Kartik Misra, 2019. "Accumulation by Dispossession and Electoral Democracies : An Analysis of Land Acquisition for Special Economic Zones in India," UMASS Amherst Economics Working Papers 2019-16, University of Massachusetts Amherst, Department of Economics.
    20. Hanming Fang & Peter Norman, 2006. "To bundle or not to bundle," RAND Journal of Economics, RAND Corporation, vol. 37(4), pages 946-963, December.
    21. Hitoshi Matsushima & Koichi Miyazaki & Nobuyuki Yagi, 2006. "Role of Linking Mechanisms in Multitask Agency with Hidden Information ( Revised as CARF-F-209(2010) )," CARF F-Series CARF-F-059, Center for Advanced Research in Finance, Faculty of Economics, The University of Tokyo.
    22. Keming Huang & Fangzhou Xia, 2023. "Classification of Rural Relative Poverty Groups and Measurement of the Influence of Land Elements: A Questionnaire-Based Analysis of 23 Poor Counties in China," Land, MDPI, vol. 12(4), pages 1-23, April.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:jpbect:v:9:y:2007:i:3:p:425-449. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/apettea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.