Public Good Provision and Group Size: Elevator Retrofits

We examine how group size affects the probability of provision of a discrete public good when all group members must agree to its provision and the manner of its funding. We derive empirically testable predictions to distinguish between models where provision depends on aggregate valuations, as in the first best and second best, and where provision depends on the minimum valuation, as might arise from social norms or strategic simplicity concerns. Our empirical application is to the presence of retrofitted elevators in old condominium buildings in Copenhagen, Denmark. Contrary to the prediction from the preference aggregating models, we find retrofitted elevators to be less common in buildings with many apartments. The rate of decline is consistent with fixed sharing models.