Common agency and public good provision under asymmetric information

摘要

The provision of public goods under asymmetric information has most oftenbeen viewed as a mechanism design problem under the aegis of an uninformedmediator. This paper focuses on institutional contexts without suchmediator. Contributors privately informed on their willingness to paynon-cooperatively offer contribution schedules to an agent who produces thepublic good on their behalf. In any separating and informative equilibriumof this common agency game under asymmetric information, instead of reducingmarginal contributions to free-ride on others, principals do so to screenthe agent's endogenous private information obtained from privately observingother principals' offers. Under weak conditions, existence of adifferentiable equilibrium is shown. Equilibria are always ex postinefficient and interim efficient if and only if the type distribution has alinear hazard rate. This points at the major inefficiency of contributiongames under asymmetric information and stands in sharp contrast with themore positive efficiency result that the common agency literature hasunveiled when assuming complete information. Extensions of the model addressdirect contracting between principals, the existence of poolinguninformative equilibria and the robustness of our findings to thepossibility that principals entertain more complex communication with theiragent.