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Voluntary Public Goods Provision, Coalition Formation, and Uncertainty

  • Nicholas E. Burger
  • Charles D. Kolstad

The literature on voluntary provision of public goods includes recent theoretical work on the formation of voluntary coalitions to provide public goods. Theory is ambiguous on the equilibrium coalition size and contribution rates. We examine the emergence of coalitions, their size, and how uncertainty in public goods provision affects contribution levels and coalition size. We find that contributions decrease when public good returns are uncertain but increase when individuals can form a coalition to provide the good. Contrary a core theoretical result, we find that coalition size increases when the public good benefits are higher. Uncertainty has no effect on coalition size.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 15543.

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Date of creation: Nov 2009
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Handle: RePEc:nbr:nberwo:15543
Note: EEE
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