We consider a mechanism design problem in economies with increasing returns. We construct a new class of rules, called w-hybrid rules, and characterize them by strategy-proofness, anonymity, envy-freeness, consumer sovereignty, and non-bossiness. We show that w-hybrid rules improve the supremal welfare loss compared with the average cost pricing rule (Moulin, 1999 and Moulin and Shenker, 2001). (C) 2015 Elsevier Inc. All rights reserved.