VOLUNTARY REVELATION OF THE DEMAND FOR PUBLIC GOODS USING A PROVISION POINT MECHANISM
Rondeau, Daniel; Schulze, William D.; Poe, Gregory L.
A one-shot provision point mechanism with money-back guarantee and proportional rebate of excess contributions is tested in an induced value framework and in experimental environments chosen to mimic field conditions. The results show that this relatively simple mechanism is empirically demand revealing in the aggregate when used with large groups of students who have heterogenous valuations for the public good. Approximately demand revealing behavior was obtained under three alternative information conditions. These results are an important step in the design of a mechanism simple enough to allow field applications, but capable of efficiently providing public goods through voluntary contributions.
WP 1997-20JEL Classification Codes: H41; C92
Charles H. Dyson School of Applied Economics and Management, Cornell University