SERIAL COST-SHARING OF EXCLUDABLE PUBLIC-GOODS

Under the ''Conservative Equal costs'' mechanism to produce a non-excl udable (one-dimensional) public good, each agent reports his demand. T he lowest reported demand of public good is produced and its cost is s hared equally among all agents. When the cost of producing the public good is convex, this mechanism is strategy-proof (even with respect to coalitions), anonymous and induces voluntary participation. No other mechanism shares these three properties. When the public good is exclu dable (its cost still convex), there is a mechanism with the same prop erties, that everyone prefers to conservative equal costs. This mechan ism excludes the agent with the lowest (equal costs) demand from consu ming (or paying for) a larger amount of the good, ameliorating the fre e-rider problem.