A given set of agents jointly own and operate a decreasing returns to scale technology (with a single input and a single output). They all contribute some input and receive some of the output. What first best allocation is equitable? We discuss three allocation mechanisms. The Equal Benefits...

Under the 'conservative equal costs' mechanism to produce a nonexcludable public good, each agent reports his demand. The lowest reported demand is produced and its cost is shared equally among all agents. When the cost of producing the public good is convex, this mechanism is strategy-proof,...