American Economic Journal:
Microeconomics
ISSN 1945-7669 (Print) | ISSN 1945-7685 (Online)
Coordinating Public Good Provision by Mediated Communication
American Economic Journal: Microeconomics
vol. 13,
no. 2, May 2021
(pp. 311–42)
Abstract
We examine a setup where two agents allocate a fixed budget between public goods in two areas. The agents may be biased to one area, which is their private information. Without communication, the funds are allocated inefficiently, resulting in gaps and duplication in public good provision. Direct communication between the agents is ineffective and cannot resolve the coordination failure even when the potential biases are negligible. Coordination can be improved by a mediator who filters the information communicated by the agents. Our results can throw light on how to improve coordination of humanitarian aid by an appropriately designed information management system.Citation
Halonen-Akatwijuka, Maija, and In-Uck Park. 2021. "Coordinating Public Good Provision by Mediated Communication." American Economic Journal: Microeconomics, 13 (2): 311–42. DOI: 10.1257/mic.20180272Additional Materials
JEL Classification
- D82 Asymmetric and Private Information; Mechanism Design
- D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
- H41 Public Goods
- H84 Disaster Aid
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