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Bargaining over public goods

Author

Listed:
  • DAVILA, Julio
  • EECKHOUT, Jan
  • MARTINELLI, César

Abstract

In a simple public good economy, we propose a natural bargaining procedure whose equilibria converge to Lindahl allocations as the cost of bargaining vanishes. The procedure splits the decision over the allocation in a decision about personalized prices and a decision about output levels for the public good. Since this procedure does not assume price-taking behavior, it provides a strategic foundation for the personalized taxes inherent to the Lindahl solution to the public goods problem.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • DAVILA, Julio & EECKHOUT, Jan & MARTINELLI, César, 2009. "Bargaining over public goods," CORE Discussion Papers RP 2185, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  • Handle: RePEc:cor:louvrp:2185
    Note: In : Journal of Public Economic Theory, 11(6),927-945, 2009
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    File URL: http://dx.doi.org/10.1111/j.1467-9779.2009.01438.x
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    References listed on IDEAS

    as
    1. Groves, Theodore & Ledyard, John O, 1977. "Optimal Allocation of Public Goods: A Solution to the "Free Rider" Problem," Econometrica, Econometric Society, vol. 45(4), pages 783-809, May.
    2. Rubinstein, Ariel, 1982. "Perfect Equilibrium in a Bargaining Model," Econometrica, Econometric Society, vol. 50(1), pages 97-109, January.
    3. repec:cup:apsrev:v:83:y:1989:i:04:p:1181-1206_08 is not listed on IDEAS
    4. Dávila, J. & Eeckhout, J., 2008. "Competitive bargaining equilibrium," Journal of Economic Theory, Elsevier, vol. 139(1), pages 269-294, March.
    5. Harrington, Joseph Jr., 1989. "The advantageous nature of risk aversion in a three-player bargaining game where acceptance of a proposal requires a simple majority," Economics Letters, Elsevier, vol. 30(3), pages 195-200, September.
    6. Thomson, William, 1999. " Economies with Public Goods: An Elementary Geometric Exposition," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 1(1), pages 139-176.
    7. Banks, Jeffrey s. & Duggan, John, 2000. "A Bargaining Model of Collective Choice," American Political Science Review, Cambridge University Press, vol. 94(01), pages 73-88, March.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Anne Van den Nouweland & Agnieszka Rusinowska, 2018. "Bargaining Foundation for Ratio Equilibrium in Public Good Economies," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-01720001, HAL.
    2. Anne van den Nouweland & Agnieszka Rusinowka, 2018. "Bargaining Foundation for Ratio Equilibrium in Public Good Economies," Documents de travail du Centre d'Economie de la Sorbonne 18004, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.

    More about this item

    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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