Incentive Mechanism Design for Production Economies with Both Private and Public Ownerships

In this paper we deal with the problem of incentive mechanism design which yields efficient allocations for general mixed ownership economies when preferences, individual endowments, and coalition patterns among individuals are unknown to the planner. We do so by doubly implementing the proportional solution for economies with any number of private sector and public sector commodities and any number of individuals as well as the coexistence of privately and publicly owned firms with general convex production possibility sets. Furthermore, the mechanisms work not only for three or more agents, but also for two-agent economies. Journal of Economic Literature Classification Numbers: C72, D61, D71, D82. © 2000 Academic Press