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Core Equivalence with Congested Public Goods


  • Vasil'ev, Valery
  • Weber, Shlomo
  • Wiesmeth, Hans


This paper examines a model of an infinite production economy with a finite number of types of agents and semi-public goods, which are subjected to crowding and exclusion. The utility of an agent depends not only on the vector of public commodities produced by the coalition to which she belongs, but also on the mass of agents of her type who are the members of this coalition. The main purpose of the paper is to derive necessary and sufficient conditions on the local degrees of congestion which would guarantee the equivalence between the core and the set of equal treatment Lindahl equilibria. We prove that this equivalence holds if and only if there are constant returns to group size for each type of agents. It implies that linearity of each agent's congestion function with respect to the mass of the agents of her own type is necessary of the core equivalence to hold.

Suggested Citation

  • Vasil'ev, Valery & Weber, Shlomo & Wiesmeth, Hans, 1995. "Core Equivalence with Congested Public Goods," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 6(3), pages 373-387, November.
  • Handle: RePEc:spr:joecth:v:6:y:1995:i:3:p:373-87

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    References listed on IDEAS

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    7. Carsten Kowalczyk & Raymond Riezman, 2013. "Free trade: what are the terms-of-trade effects?," World Scientific Book Chapters,in: International Trade Agreements and Political Economy, chapter 10, pages 149-164 World Scientific Publishing Co. Pte. Ltd..
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    Cited by:

    1. MONIQUE FLORENZANO & ELENA L. del MERCATO, 2006. "Edgeworth and Lindahl-Foley equilibria of a General Equilibrium Model with Private Provision of Pure Public Goods," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 8(5), pages 713-740, December.
    2. Kovalenkov, Alexander & Wooders, Myrna, 2003. "Approximate cores of games and economies with clubs," Journal of Economic Theory, Elsevier, vol. 110(1), pages 87-120, May.
    3. Marakulin, V.M., 2013. "On the Edgeworth conjecture for production economies with public goods: A contract-based approach," Journal of Mathematical Economics, Elsevier, vol. 49(3), pages 189-200.
    4. Berliant, Marcus & Konishi, Hideo, 2000. "The endogenous formation of a city: population agglomeration and marketplaces in a location-specific production economy," Regional Science and Urban Economics, Elsevier, vol. 30(3), pages 289-324, May.
    5. Shitovitz, Benyamin & Weber, Shlomo, 1997. "The graph of Lindahl correspondence as the unique von Neumann-Morgenstern abstract stable set," Journal of Mathematical Economics, Elsevier, vol. 27(4), pages 375-387, May.
    6. Maria Graziano & Maria Romaniello, 2012. "Linear cost share equilibria and the veto power of the grand coalition," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 38(2), pages 269-303, February.
    7. ten Raa, Thijs & Gilles, Robert P., 2005. "Lindahl equilibrium and Schweizer's open club model with semipublic goods," Mathematical Social Sciences, Elsevier, vol. 49(3), pages 295-307, May.
    8. repec:hal:journl:halshs-00085726 is not listed on IDEAS

    More about this item

    JEL classification:

    • D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods


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