Abstract
Excludable public goods with non-rivalry and private goods with network externalities have similar coordination problems. In this study, we define generalized non-rivalry to investigate coordination mechanisms for both types of goods. We employ the equal cost-sharing with maximal participation (ECSMP) mechanism, which has been studied for excludable public goods with non-rivalry. We find that the mechanism is optimal regarding two welfare criteria in an environment with generalized non-rivalry, within which this study characterizes the ECSMP mechanism. The results indicate that ECSMP is a promising mechanism in a broader context than that considered in the existing literature.
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