On the Efficient Provision of Public Goods by Means of Lotteries
We provide a solution to the free-rider problem in the provision of a public good. To this end we define a biased indirect contribution game which provides the efficient amount of the public good in non-cooperative Nash equilibrium. No confiscatory taxes or other means of coercion are used. We rather extend the model of Morgan (2000), who used fair raffles as voluntary contribution schemes, to unfair or biased raffles, which we show to be equivalent to fair raffles whose tickets are sold to consumers at different individual prices. We give a detailed account of the solution for the case of two different consumers and discuss its implications for the general case of many consumers.
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- John Morgan, 2000. "Financing Public Goods by Means of Lotteries," Review of Economic Studies, Oxford University Press, vol. 67(4), pages 761-784.
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0802, Centre for Research into Industry, Enterprise, Finance and the Firm.
- Marco Faravelli, 2011. "The Important Thing Is Not (Always) Winning but Taking Part: Funding Public Goods with Contests," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 13(1), pages 1-22, 02.
- Marco Faravelli, 2006. "The Important Thing Is not (Always) Winning but Taking Part: Funding Public Goods with Contests," Working Papers 102, University of Milano-Bicocca, Department of Economics, revised Nov 2006.
- Marco Faravelli, 2007. "The Important Thing is not (Always) Winning but Taking Part: Funding Public Goods with Contests," ESE Discussion Papers 156, Edinburgh School of Economics, University of Edinburgh.
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814577000000000225, UCLA Department of Economics.
- Paul Pecorino & Akram Temimi, 2007. "Lotteries, Group Size, and Public Good Provision," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 9(3), pages 451-465, 06.
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