Efficient Provision of Public Goods With Endogenous Redistribution∗

Efficient Provision of Public Goods with Endogenous Redistribution * Efficient Provision of Public Goods

We study a continuous and balanced mechanism that is capable of implementing in Nash equilibrium all the Pareto-efficient individually rational allocations for an economy with public goods. The Government chooses a set of weights directly related to the Lindahl prices corresponding to the Pareto-efficient allocation it wants to implement. The mechanism then guarantees that initial endowments ar...

The Private Provision of Public Goods: Neutrality, Efficiency, Equity and Population

In this paper, we present a new neutrality theorem in the theory of private provision of public good. Our new theorem is qualitative or global in the sense that it does not depend on the original equilibrium allocation. The theorem will reveal that the equilibrium obtained under a proper income redistribution can be made more efficient in the strict Pareto’s sense than the original allocation. ...

Pure Redistribution and the Provision of Public Goods

Optimal Income Taxation and Public-Goods Provision with Preference and Productivity Shocks

We study how an optimal income tax and an optimal public-goods provision rule respond to preference and productivity shocks. A conventional Mirrleesian treatment is shown to provoke manipulations of the policy mechanism by individuals with similar interests. We therefore extend the Mirrleesian model so as to include a requirement of coalition-proofness. The main results are the following: first...

Centralized provision of public goods: static vs dynamic performance in the presence of political pressure, lobbying and heterogeneity of tastes

This paper analyses the efficiency of centralized public goods provision in a model of incomplete contracts. Politicians determine the level of provision through wasteful yet publicly unobservable lobbying efforts. Thereby a threat of dismissal from office caused by regional expectations in terms of reservation utility induces politicians to push for influence of their region’s taste. In a stat...