 How much they will contribute will depend on their reservation prices \(r_{\textrm{Bob}}\) and \(r_{\textrm{Sally}},\) i.e., on the maximum amount of the private good each agent is willing to give up for the public good. It is then easy to show that the production of the public good will be a Pareto-improvement if and only if (Varian 1992:  416)[2]: