Club good intermediaries

Loertscher, Simon; Marx, Leslie M.

doi:10.1016/j.ijindorg.2016.05.007

Cited by 5 publications

(4 citation statements)

References 32 publications

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“…Of course, club goods—goods that are nonrivalrous in consumption but permit exclusion—dominate both public goods and private goods as they incorporate either as a special case (see e.g. Cornelli 1996 ; Loertscher and Marx 2017 ). So in the presence of the availability of club goods, any comparison of public versus private goods becomes a comparison of suboptimal alternatives, perhaps begging the question as to the relevance of that exercise.…”

Section: Public Goods In Large Economiesmentioning

confidence: 99%

To sell public or private goods

Loertscher

Marx²

2022

Rev Econ Design

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Traditional analysis takes the public or private nature of goods as given. However, technological advances, particularly related to digital goods such as non-fungible tokens, increasingly make rivalry a choice variable of the designer. This paper addresses the question of when a profit-maximizing seller prefers to provide an asset as a private good or as a public good. While the public good is subject to a free-rider problem, a profit-maximizing seller or designer faces a nontrivial quantity-exclusivity tradeoff, and so profits from collecting small payments from multiple agents can exceed the large payment from a single agent. We provide conditions under which the profit from the public good exceeds that from a private good. If the cost of production is sufficiently, but not excessively, large, then production is profitable only for the public good. Moreover, if the lower bound of the support of the buyers’ value distribution is positive, then the profit from the public good is unbounded in the number of buyers, whereas the profit from selling the private good is never more than the upper bound of the support minus the cost. As the variance of the agents’ distribution becomes smaller, public goods eventually outperform private goods, reflecting intuition based on complete information models, in which public goods always outperform private goods in terms of revenue.

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Section: Public Goods In Large Economiesmentioning

confidence: 99%

To sell public or private goods

Loertscher

Marx²

2022

Rev Econ Design

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“…In this sense, our work follows a relatively sparse literature on club goods started by Buchanan (1965), with more recent work by Deb and Razzolini (2001), Baik, Kim, and Na (2001), Norman (2004), andFang andNorman (2010). In this literature, Loertscher and Marx (2017) study optimal pricing mechanisms for intermediaries of club goods. This article differs from this literature in allowing buyers to form coalitions which act as individual entities on the club-good marketplace.…”

Section: Related Literaturementioning

confidence: 99%

Patent Auctions and Bidding Coalitions: Structuring the Sale of Club Goods

Asker

Baccara

Lee

2021

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We thank three anonymous referees and the editor Nicola Persico for helpful comments and suggestions. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peer-reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

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“…Club goods were popularized by Buchanan (1965) and studied in various contexts. The literature on club goods studies questions such as optimal number of members in a club, optimal quantity of club-good provision, pricing policies and exclusion mechanisms (Sandler and Tschirhart, 1980;Hillman, 1993;Sandler and Tschirhart, 1997;Loertscher and Marx, 2017;Mackenzie and Trudeau, 2017). As far as we know, fair allocation of goods among different clubs has not been considered yet.…”

Section: Public and Club Goodsmentioning

confidence: 99%

Fairness for Multi-Self Agents

Bade¹,

Segal-Halevi²

2018

Preprint

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Fair division theory mostly involves individual consumption. But resources are often allocated to groups, such as families or countries, whose members consume the same bundle but have different preferences. Do fair and efficient allocations exist in such an "economy of families"?We adapt three common notions of fairness: fair-share, no-envy and egalitarian-equivalence, to an economy of families. The stronger adaptation -individual fairness -requires that each individual in each family perceives the division as fair; the weaker one -family fairness -requires that the family as a whole, treated as a single agent with (typically) incomplete preferences, perceives the division as fair. Individual-fair-share, family-no-envy and family-egalitarianequivalence are compatible with efficiency under broad conditions. The same holds for individual-no-envy when there are only two families. In contrast, individual-no-envy with three or more families and individual-egalitarian-equivalence with two or more families are typically incompatible with efficiency, unlike the situation in an economy of individuals. The common market equilibrium approach to fairness is of limited use in economies with families. In contrast, the leximin approach is broadly applicable: it yields an efficient, individual-fairshare, and family-egalitarian-equivalent allocation.

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Club good intermediaries

Cited by 5 publications

References 32 publications

To sell public or private goods

To sell public or private goods

Patent Auctions and Bidding Coalitions: Structuring the Sale of Club Goods

Fairness for Multi-Self Agents

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