Coordinating Public Good Provision by Mediated Communication

We examine a setup where two agents allocate fixed budget between public goods in areas. The may be biased to one area, which is their private information. Without communication, the funds are allocated inefficiently, resulting gaps and duplication good provision. Direct communication ineffective cannot resolve coordination failure even when potential biases negligible. Coordination can improved by mediator who filters information communicated agents. Our results throw light on how improve of humanitarian aid an appropriately designed management system. (JEL D82, D83, H41, H84)