On Voting Procedures for Decision‐making on Public Goods

Abstract

ABSTRACTIf one accepts Samuelson's verdict that no decentralized pricing system can serve to determine optimally the levels of collective consumption, and that some other type of procedure or mechanism would have to be tried, two problems immediately arise. First, representation, i.e. the phenomenon that in all other existing mechanisms only a small fraction of the individuals involved can participate directly. The second problem is co‐ordination, due to the fact that parallel mechanisms have to be used for the allocation of private and public goods. Furthermore, if one would opt for some sort of voting procedure in order to determine the levels of public goods, the additional problem of incentive compatibility has to be coped with. The article aims to clarify the political relevance of these issues.