Split it up to create incentives: Investment, public goods and crossing the river

A-Tier
Journal: Journal of Economic Theory
Year: 2020
Volume: 189
Issue: C

Score contribution per author:

2.011 = (α=2.01 / 2 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

When should one pay the ferryman? When to pay for the delivery of a good, and how should one invest in a public good if there is a single transaction and institutions are costly? We show how to solve the hold-up problem. The idea is to appropriately split up the desired total contribution into several separate contributions that are made in sequence, with each party threatening to discontinue if others deviate. Our solution concept is based on subgame perfection, where players are either selfish and do not care about very small gains or are socially minded as long as there is no deviation.

Technical Details

RePEc Handle
repec:eee:jetheo:v:189:y:2020:i:c:s0022053120300867
Journal Field
Theory
Author Count
2
Added to Database
2026-01-25