Abstract
This paper deals mainly with the problem of designing mechanisms whose Nash allocations coincide with the Lindahl allocations for public goods economies with any number of private and public goods. The mechanism presented here improves the previous mechanisms by introducing two new features. One is that the mechanism is balanced (not merely weakly balanced). The other is that the level of public goods is provided with the marginal cost pricing rule for both equilibrium and disequilibrium messages so that the single-valued input demand outcome function is obtained by the Shephard lemma and the prices of public goods equal the minimum-unit-cost functions. Besides, the mechanism is single-valued, individually feasible, and continuous.
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