Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/174502
Authors: 
Engel, Christoph
Hippel, Svenja
Year of Publication: 
2017
Series/Report no.: 
Preprints of the Max Planck Institute for Research on Collective Goods 2017/23
Abstract: 
Public goods are dealt with in two literatures that neglect each other. Mechanism design advises a social planner that expects individuals to misrepresent their valuations. Experiments study the provision of the good when preferences might be non-standard. We introduce the problem of the mechanism design literature into a public good experiment. Valuations for the good are heterogeneous. To each group we add a participant with power to impose a contribution scheme. We study four settings: the authority has no personal interest and (1) valuations are common knowledge or (2) active participants may misrepresent their types; the authority has a personal interest (3) and must decide before learning her own valuation or (4) knows her own valuation. Disinterested social planners predominantly choose a payment rule that gives every group member the same ?nal payoff, even if misrepresentation is possible. Authorities are overly optimistic about truth telling. Interested social planners abuse their power, except if the opportunity cost of a more balanced rule is small.
Subjects: 
Public Good
Social Planner
Truthtelling
Experiment
JEL: 
C91
D02
D03
D61
D62
D64
H23
K12
Document Type: 
Working Paper

Files in This Item:
File
Size
841.54 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.