Voting and Lottery Drafts as Efficient Public Goods Mechanisms.

This paper characterizes interim efficient mechanisms for public good production and cost allocation in a two-type environment with risk-neutral, quasi-linear preferences and fixed-size projects, where the distribution of the private good, as well as the public goods decision, affects social welfare. An efficient public good decision can always be accomplished by a majority voting scheme, where the number of 'YES' votes required depends on the welfare weights in a simple way. The results are shown to have a natural geometry and an intuitive interpretation. Copyright 1994 by The Review of Economic Studies Limited.