Funding public projects: A Case for the Nash product rule
Florian Brandl (University of Bonn), Felix Brandt (Technische Universität München), Matthias Greger (Technische Universität München), Dominik Peters (University of Toronto), Christian Stricker (Technische Universität München) and Warut Suksompong (National University of Singapore)
GPI Working Paper No. 14-2021, published in Journal of Mathematical Economics
We study a mechanism design problem where a community of agents wishes to fund public projects via voluntary monetary contributions by the community members. This serves as a model for public expenditure without an exogenously available budget, such as participatory budgeting or voluntary tax programs, as well as donor coordination when interpreting charities as public projects and donations as contributions. Our aim is to identify a mutually beneficial distribution of the individual contributions. In the preference aggregation problem that we study, agents report linear utility functions over projects together with the amount of their contributions, and the mechanism determines a socially optimal distribution of the money. We identify a specific mechanism—the Nash product rule—which picks the distribution that maximizes the product of the agents’ utilities. This rule is Pareto efficient, and we prove that it satisfies attractive incentive properties: it spends each agent’s contribution only on projects the agent finds acceptable, and agents are strongly incentivized to participate.
Other working papers
How important is the end of humanity? Lay people prioritize extinction prevention but not above all other societal issues. – Matthew Coleman (Northeastern University), Lucius Caviola (Global Priorities Institute, University of Oxford) et al.
Human extinction would mean the deaths of eight billion people and the end of humanity’s achievements, culture, and future potential. On several ethical views, extinction would be a terrible outcome. How do people think about human extinction? And how much do they prioritize preventing extinction over other societal issues? Across six empirical studies (N = 2,541; U.S. and China) we find that people consider extinction prevention a global priority and deserving of greatly increased societal resources. …
Critical-set views, biographical identity, and the long term – Elliott Thornley (Global Priorities Institute, University of Oxford)
Critical-set views avoid the Repugnant Conclusion by subtracting some constant from the welfare score of each life in a population. These views are thus sensitive to facts about biographical identity: identity between lives. In this paper, I argue that questions of biographical identity give us reason to reject critical-set views and embrace the total view. I end with a practical implication. If we shift our credences towards the total view, we should also shift our efforts towards ensuring that humanity survives for the long term.
The epistemic challenge to longtermism – Christian Tarsney (Global Priorities Institute, Oxford University)
Longtermists claim that what we ought to do is mainly determined by how our actions might affect the very long-run future. A natural objection to longtermism is that these effects may be nearly impossible to predict— perhaps so close to impossible that, despite the astronomical importance of the far future, the expected value of our present actions is mainly determined by near-term considerations. This paper aims to precisify and evaluate one version of this epistemic objection to longtermism…