Resource title

Informative voting and the Samuelson rule

Resource image

image for OpenScout resource :: Informative voting and the Samuelson rule

Resource description

We study the classical free-rider problem in public goods provision in a large economy with uncertainty about the average valuation of the public good. Individual preferences over public goods are shaped by a skill and a taste parameter. We use a mechanism design approach to solve for the optimal utilitarian provision rule. The relevant incentive constraints for information aggregation ensure that individuals behave as if they were engaging in informative voting over the level of public good provision. It is shown that the use of information by an optimal provision rule is inversely related to the polarization of preferences which results from the properties of the skill distribution.

Resource author

Felix Bierbrauer, Marco Sahm

Resource publisher

Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/26902

Resource license

Adapt according to the presented license agreement and reference the original author.