Title: Optimal provision of multiple excludable public goods
First published: 2008
Description: "This paper studies the optimal provision mechanism for multiple excludable public goods when agents' valuations are private information.  For a parametric class of problems with binary valuations, we demonstrate that the optimal mechanism involves bundling if a regularity condition, akin to a hazard rate condition, on the distribution of valuations is satisfied.  Bundling alleviates the free riding problem in large economies in two ways: first, it may increase the asymptotic provision probability of socially efficient public goods from zero to one; second, it decreases the extent of use exclusions.  If the regularity condition is violated, then the optimal solution replicates the separate provision outcome"--National Bureau of Economic Research web site.
LC classification: HB1