SFB 303 Discussion Paper No. A - 104

Author: Gradstein, Mark, and Shmuel Nitzan
Title: Voluntary Participation and the Provision of Public and Private Goods
Abstract: In this study an attempt is made to present and apply a formal theory of voluntary participation in collective actions. Two major applications are considered: the provision of a pure public good and labor effort determination in a labor managed firm that produces and distributes among its members a private good. The analysis focuses on the following issues:
(i) The investigation of the basic properties of the Nash equilibria of the proposed noncooperative game of voluntary participation in collective actions.
(ii) The characterization of the Pareto-efficient rate of participation.
(iii) The comparison between the rates of participation in pure strategy equilibria, mixed strategy equilibria, Pareto-efficient allocations, and the socially optimal allocations according to the utilitarian criterion.
(iv) The implementation of the socially optimal rate of participation.
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Creation-Date: 1987
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