Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/32235
Authors: 
Hellwig, Martin
Year of Publication: 
2009
Series/Report no.: 
Preprints of the Max Planck Institute for Research on Collective Goods 2009,12
Abstract: 
This paper studies the design of optimal utilitarian mechanisms for an excludable public good. Excludability provides a basis for making people pay for admissions; the payments can be used for redistribution and/or funding. Whereas previous work assumed that admissions are governed by the payment or nonpayment of a price, this paper allows for arbitrary admission rules. With sufficient inequality aversion, nondegenerate randomization in admissions is shown to be desirable for certain model specifications, with and without participation constraints. The paper also gives a sufficient condition on the distribution of preferences under which randomization is undesirable.
Subjects: 
Utilitarian welfare maximization
Admission rules for excludable public goods
Randomization in optimal mechanisms
JEL: 
D61
D63
H21
H41
Document Type: 
Working Paper

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