Quadratic Funding mechanism and Project Choice

Details

Supervisors

KIEDAISCH, Christian

Faculty

Faculté des sciences économiques, sociales, politiques et de communication

Degree label

Master [120] en sciences économiques, orientation générale, à finalité spécialisée

Abstract

Quadratic Funding is a recent mechanism extending from the concept of Quadratic Voting. QF is a funding mechanism for endogenous community formation. Citizens make public goods contributions to projects of value to them and the amount received by the project is (proportional to) the square of the sum of the square roots of contributions received. In the context of funding public goods, Quadratic Funding could be an interesting alternative to traditional ways of funding those projects and could help to solve the "public goods" problem (also called "free-rider" problem). In my thesis, I first make a litterature review of what has already been explored in this field and present a simple theorical model of Quadratic Funding (with setting, equations and derivations), to then discuss its limitations. In this context, I will study a setting in which there are two projects that can potentially be funded by Quadratic Funding. I then try to answer whether Quadratic Funding leads to an optimal project choice and if so, under which assumptions. Finally, I look at a potential particular application of this mechanism and analyze which practical problems arise and how they could be solved.