Collective Choice in Dynamic Public Good Provision

53 Pages Posted: 7 Nov 2016

See all articles by T. Renee Bowen

T. Renee Bowen

University of California, San Diego; National Bureau of Economic Research; Center for Commerce and Diplomacy (CCD)

George Georgiadis

Northwestern University - Kellogg School of Management

Nicolas S. Lambert

Stanford Graduate School of Business - Knight Management Center

Multiple version iconThere are 4 versions of this paper

Date Written: November 2016

Abstract

Two heterogeneous agents contribute over time to a joint project, and collectively decide its scope. A larger scope requires greater cumulative effort and delivers higher benefits upon completion. We show that the efficient agent prefers a smaller scope, and preferences are time-inconsistent: as the project progresses, the efficient (inefficient) agent's preferred scope shrinks (expands). We characterize the equilibrium outcomes under dictatorship and unanimity, with and without commitment. We find that an agent's degree of efficiency is a key determinant of control over project scopes. From a welfare perspective, it may be desirable to allocate decision rights to the inefficient agent.

Keywords: authority, collective choice, contribution games, free-riding, Public Goods

JEL Classification: C73, D70, D78, H41

Suggested Citation

Bowen, T. Renee and Georgiadis, George and Lambert, Nicolas S., Collective Choice in Dynamic Public Good Provision (November 2016). CEPR Discussion Paper No. DP11602, Available at SSRN: https://ssrn.com/abstract=2865870

T. Renee Bowen (Contact Author)

University of California, San Diego ( email )

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HOME PAGE: http://https://sites.google.com/site/tamarareneebowenlyn/

National Bureau of Economic Research ( email )

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Center for Commerce and Diplomacy (CCD) ( email )

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HOME PAGE: http://https://ccd.ucsd.edu/

George Georgiadis

Northwestern University - Kellogg School of Management ( email )

2001 Sheridan Road
Evanston, IL 60208
United States

Nicolas S. Lambert

Stanford Graduate School of Business - Knight Management Center ( email )

655 Knight Way
Stanford, CA 94305-7298
United States

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