mechanisms, i.e. there are ad-hoc constraints on the class of contracts. Also taking distribution costs and congestion effects into account, Schmitz (1997) studies a related problem, but he allows for general mechanisms. Moreover, he also characterizes the second-best allocation rule, which is welfare-maximizing under the constraint of nonnegative profits. Using the incomplete contracts theory, Francesconi and Muthoo (2011) explore whether public or private ownership is more desirable when non-contractible investments have to be made in order to provide a (partly) excludable public good. See also Rivalry Free rider problem Tragedy of the Commons References Further reading Excludability, in: Joseph E. Stiglitz: Knowledge as a Global Public Good, World Bank. Last accessed 29 May 2007. Copy at the Internet Archive Goods (economics)