Interior matching equilibria in a public good economy: An aggregative game approach

Wolfgang Buchholz; Richard Cornes; Dirk Rübbelke

doi:10.1016/j.jpubeco.2010.12.010

Interior matching equilibria in a public good economy: An aggregative game approach

Wolfgang Buchholz, Richard Cornes, Dirk Rübbelke^*

^*Corresponding author for this work

Research output: Contribution to journal › Article › peer-review

34 Citations (Scopus)

Abstract

If the equilibrium generated by a matching mechanism is to be the desired Pareto optimal outcome, it is necessary for every player to be at an interior solution at that equilibrium. Using the aggregative game approach developed by Cornes and Hartley (2003, 2007), this paper analyzes the conditions under which matching mechanisms in a public good economy lead to interior matching equilibria at which all agents make strictly positive flat contributions to the public good. In particular, we show that the distribution of income among the agents is crucial for both the existence of interior matching equilibria and Warr neutrality in the case of matching.

Original language	English
Pages (from-to)	639-645
Number of pages	7
Journal	Journal of Public Economics
Volume	95
Issue number	7-8
DOIs	https://doi.org/10.1016/j.jpubeco.2010.12.010
Publication status	Published - Aug 2011

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title = "Interior matching equilibria in a public good economy: An aggregative game approach",

abstract = "If the equilibrium generated by a matching mechanism is to be the desired Pareto optimal outcome, it is necessary for every player to be at an interior solution at that equilibrium. Using the aggregative game approach developed by Cornes and Hartley (2003, 2007), this paper analyzes the conditions under which matching mechanisms in a public good economy lead to interior matching equilibria at which all agents make strictly positive flat contributions to the public good. In particular, we show that the distribution of income among the agents is crucial for both the existence of interior matching equilibria and Warr neutrality in the case of matching.",

keywords = "Aggregative games, Matching mechanisms, Public goods, Warr neutrality",

author = "Wolfgang Buchholz and Richard Cornes and Dirk R{\"u}bbelke",

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language = "English",

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AU - Rübbelke, Dirk

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N2 - If the equilibrium generated by a matching mechanism is to be the desired Pareto optimal outcome, it is necessary for every player to be at an interior solution at that equilibrium. Using the aggregative game approach developed by Cornes and Hartley (2003, 2007), this paper analyzes the conditions under which matching mechanisms in a public good economy lead to interior matching equilibria at which all agents make strictly positive flat contributions to the public good. In particular, we show that the distribution of income among the agents is crucial for both the existence of interior matching equilibria and Warr neutrality in the case of matching.

AB - If the equilibrium generated by a matching mechanism is to be the desired Pareto optimal outcome, it is necessary for every player to be at an interior solution at that equilibrium. Using the aggregative game approach developed by Cornes and Hartley (2003, 2007), this paper analyzes the conditions under which matching mechanisms in a public good economy lead to interior matching equilibria at which all agents make strictly positive flat contributions to the public good. In particular, we show that the distribution of income among the agents is crucial for both the existence of interior matching equilibria and Warr neutrality in the case of matching.

KW - Aggregative games

KW - Matching mechanisms

KW - Public goods

KW - Warr neutrality

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DO - 10.1016/j.jpubeco.2010.12.010

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SP - 639

EP - 645

JO - Journal of Public Economics

JF - Journal of Public Economics

IS - 7-8

ER -

Interior matching equilibria in a public good economy: An aggregative game approach

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