Classic episode . And good explanation of why the government faces less risk than a Kickstarter entrepreneur . The issue at hand is that funding for public goods provision is not necessarily provided by people with the greatest willingnesstopay for the good . In a oneproject setup , this is obviously an enormous issue , as you can end up with a large distortion from misalignment . It sounds like you ' re saying that preferences in the real world are heterogenous , so everyone paying an equal price means misalignment . But I thought Section 3 of the paper dropped the homogeneous preferences assumption . If the problem is that people ' s heterogeneous preferences are secret , and they have an incentive to distort them , then that would be a problem , perhaps leading to the winner ' s curse outcome you ' ve mentioned . How big of a problem is the winner ' s curse with Kickstarter ? Also only an extreme libertarian thinks this is a serious issueThe freerider problem is only a serious issue to extreme libertarians ? !