Pooling private technologies: Improving upon autarky

When n agents decide to pool their private, decreasing returns technologies, single-path methods are a natural way to share joint output because of their strong incentives properties (Friedman, 2002). They are a non-anonymous generalization of the serial rule (Moulin and Shenker, 1992) sharing a production function along a prespeci…ed path. We show that only one of these methods satis…es voluntary participation; its generating path is entirely determined by the n production functions. This yields a bijection between single-path methods and distributions of property rights on a single technology. Also, we show that these methods are characterized by their incentives properties in the 2-agent case, but not for n 3. Keywords: Autarky, incentive compatibility, joint production, serial rule, technology pooling. JEL classi…cation numbers: C72, D62, D71.