Stable partnerships, matching, and local public goods

In the presence of local public goods differences in tastes are an important determinant of the way in which partnerships are formed. Heterogeneity in tastes for private vs. public goods produces a tendency to positive assortment and partnerships of couples with similar tastes; heterogeneity in tastes for different public goods brings about partnerships of couples with similar tastes only if there is a significant overlap in the distribution of tastes of the two groups to be matched. We show that with two public goods we may get negative assortment, pure positive assortment being only one of many possibilities.     

Centralized versus decentralized provision of local public goods: a political economy approach

This paper takes a fresh look at the trade-off between centralized and decentralized provision of local public goods. It argues that the sharing of the costs of local public spending in a centralized system will create a conflict of interest between citizens in different jurisdictions. When spending decisions are made by a legislature of locally elected representatives, this conflict of interest will play out in the legislature. Depending on precisely how the legislature behaves, the result may be excessive public spending or allocations of public goods characterized by uncertainty and misallocation across districts. The extent of the conflict of interest between districts is affected by spillovers and differences in tastes for public spending. Thus, the relative performance of centralized and decentralized systems depends upon spillovers and differences in tastes for public spending, but for different reasons than suggested in the existing literature.     

Distribution of tastes and skills and the provision of local public goods

This paper introduces into the Tiebout model individuals with different skills. It is shown that the production techniques, the distribution of tastes and skills and intercommunity trade will affect the pattern of communities. In the suggested model competition with local public goods is Pareto optimal: communities will not be composed of identical people. The optimal solution requires that every community will tax everybody according to his marginal social cost. A Pareto efficient redistribution policy can be carried out only by a central government using lump-sum taxes. A federal income tax will affect community patterns and therefore is inefficient.     

Sharing budgetary austerity under free mobility and asymmetric information: An optimal regulation approach to fiscal federalism

In the present article, Tiebout meets Laffont and Tirole in the land of fiscal federalism. A non-trivial Principal–Multi-Agent model is used to characterize the optimal intergovernmental grant schedule, when the cost of local public goods depends on hidden characteristics and actions of local governments, and under citizen free mobility. We show how informational rents, landlords' interests, and citizen mobility interact to produce distortions at both ends of the type space: in particular the most efficient jurisdictions should overproduce and overtax in second-best optimum. Informational asymmetries decrease the average production of public goods and increase the inter-jurisdictional variance of taxes and public-good production.     

官员规模、公共品供给与社会收入差距:权力寻租的视角

官员规模、公共品供给效率以及社会收入差距是当下社会比较关注的问题,本文试图把三个问题纳入到一个故事框架下来分析和解释。生产的进行需要官员提供资源帮扶,这需要通过雇佣下级官员来做到;当私人利益进入上级官员的收益函数时,上级官员就会促使资源的供给"人为"稀缺来设租,从而便于下级官员从生产者处收取资源租金;而资源租金的收取使得下级官员的收益高于其外部选择权收益,从而增加了下级官员职位的竞争性,又由于上级官员对下级官员职位任命权的垄断,使上级官员从下级官员处收取职位租金。分析表明,权力的设租寻租行为是造成社会收入差距出现的一个重要原因;在一个能较好限制官员关注私人收益的社会中,官员规模较小、公共品供给效率较高且因权力寻租而造成的社会收入差距较小。     

Migration with local public goods and the gains from changing places

Without public goods and under fairly standard assumptions, in Hammond and Sempere (J Pub Econ Theory, 8: 145–170, 2006) we show that freeing migration enhances the potential Pareto gains from free trade. Here, we present a generalization allowing local public goods subject to congestion. Unlike the standard literature on fiscal externalities, our result relies on fixing both local public goods and congestion levels at their status quo values. This allows constrained efficient and potentially Pareto improving population exchanges regulated only through appropriate residence charges, which can be regarded as Pigouvian congestion taxes.     

西部开发中的地方公共品有效供给分析

本文从地方公共品的性质和供给特点出发 ,分析了地方公共品有效供给的帕累托条件。在此基础上指出 ,西部开发中地方公共品有效供给不足主要表现为地方公共品供给总量不足、供给结构不合理及中央政府和地方政府对地方公共品的供求管理错位 ,主要的改进措施是扩大西部地方公共品投资力度、优化供给结构 ,并建立规范的中央财政转移支付制度、健全西部地方公共品管理体制。     

Tiebout with Politics: Capital Tax Competition and Constitutional Choices

This paper examines how capital tax competition affects jurisdiction formation. We describe a non-cooperative locational model of public goods provision choices, where the levels of taxation and the local public good varieties provided within jurisdictions are selected by majority voting, and where equilibrium jurisdictions consist of consumers with similar tastes. We show that interjurisdictional tax competition results in an enlargement of jurisdictional boundaries, and, even in the absence of intrajurisdictional transfers, can raise welfare for all members of a jurisdiction.     

Tiebout bias on the demand for local public goods

Empirical work estimating the demand for local public goods has been based upon the median voter model. It has generally proceeded with little consideration given to the possibility of Tiebout-type migration emphasized in the property value literature. In this paper we raise the question of how valid the typical cross section demand estimation procedures are when possible Tiebout-like migration among jurisdictions is taken into account. We find that such procedures are not in fact consistent with a model in which people vote with their feet as well as with ballots. We also show that, if a full Tiebout equilibrium has been achieved in a set of communities, there is a simple and obvious way to estimate demands for local public goods which is different from the median voter approach. This technique has not, to our knowledge, been used in existing studies, and, moreover, has some practical as well as theoretical advantages. If the workings of the Tiebout process are not taken into account, more is involved than just impracticality: we show that the estimated effects of personal characteristics will generally be biased, and that that direction of the bias can usually be determined.     

Commodity tax competition between member states of a federation: equilibrium and efficiency

The purpose of this paper is to characterize the outcome of tax competition between autonomous fiscal authorities. It treats the case of a two-region economy, where an origin-based commodity tax is levied by each region on some private good to finance a local public good. A second private good is untaxed.We first describe ‘regional market equilibria’, whereupon consumers of each region allocate their purchases of private goods between domestic and nondomestic ones according to the structure of relative prices, taxes, and transportation costs. Next, regional optimal tax levels and public good quantities are derived, the tax of the other region being held constant. Fiscal competition arises from the ability of one region in choosing its tax to alter the tax base of the other.A ‘noncooperative fiscal equilibrium’ (NCFE) is then defined as the pair of fiscal choices such that each region's tax and public good supply are optimal for itself, given those of the other region. After examining the conditions for the existence of a NCFE, its efficiency properties are considered. Pareto efficient tax levels are computed and compared with the NCFE ones, showing the sources and nature of fiscal externalities. Finally, it is established that, in this model, fiscal choices that are Pareto improving with respect to a NCFE never reduce the taxes in both regions, and always increase the tax of a tax importing region.     

Voluntary contributions when the public good is not necessarily normal

We argue that there are interesting examples of privately provided public goods that do not satisfy the assumption of strict normality, and reconsider voluntary-contribution games in a more general framework. We show that, in general, (1) equalizing transfers between individuals with identical tastes can increase total supply of the public good, and (2) more of the public good can be supplied if agents move sequentially rather than simultaneously. These results are in sharp contrast to earlier conclusions derived in the literature under the assumption of strict normality.     

Heterogeneity in Consumer Demands and the Income Effect: Evidence from Panel Data

This paper uses unique Spanish panel data on household expenditures to test whether unobservable heterogeneity in household demands (taste, etc.) is correlated with total expenditures (income). The main finding is that tastes are indeed correlated with income for about half of the goods considered, implying that cross‐sectional estimates of income elasticities for these goods are biased. The goods are the following: food eaten outside home, alcohol and tobacco, transportation, and energy. The elasticity of alcohol and tobacco is more than halved when taking unobserved heterogeneity into account. For transportation, the bias is sufficiently large to misclassify the good as a luxury.     

Private information,Coasian bargaining,and the second welfare theorem

Most of the debate about Coasian bargaining in the presence of externalities relates to the First Welfare Theorem: is the outcome under bargaining efficient? This debate has involved the definition and importance of transaction costs, the significance of private information, and the effect of entry. There has been little analysis of how Coasian bargaining relates to the Second Welfare Theorem: even if the bargaining outcome is efficient, does the process limit the set of Pareto optimal allocations which can be achieved?We consider a model in which individuals utilize a common resource and may affect each other's output. The individuals differ in their productivities or tastes and this information is private to each of them. The government can manage the common resource and use nonlinear taxes to correct for the externality or it can turn the common resource over to a private owner who can charge individuals to utilize it with a nonlinear fee schedule. The government and the owner have the same information about tastes and productivities of the individuals. Except for the private information, there are no bargaining or administrative costs for collecting the taxes or fees. Whether there is public or private ownership, the government desires to redistribute, but it faces self-selection constraints.We show that the outcome of Coasian bargaining is constrained Pareto efficient. That is, given the information constraints, no Pareto improvement is possible. However, private ownership may limit what Pareto optimal allocations the government can achieve. The private owner in seeking to maximize profits always proposes contracts which counteract the government's attempts to redistribute across individuals with different characteristics. Under public management, any Pareto optimum can be sustained. In this context, private ownership, while not inefficient, does limit the government's ability to redistribute.     

Optimal jurisdictional fragmentation and mobility

Tiebout's hypothesis is examined in a model with the continuum of income classes and no economies of scale of population in public output provision. Any efficient allocation of resources can be achieved in this model by a system of jurisdictions, each containing a separate income class, and each using a local property tax to finance local public output. However, in general at most one such allocation will be an equilibrium if residents can ‘vote with their feet’. Conditions are derived under which higher-income residents will locate in jurisdictions providing a higher level of public output. These are shown necessary, given a separable utility function, for any optimal allocation to be sustainable as an equilibrium when residents are mobile.     

交通基础设施的公共产品属性探析

交通基础设施是为满足全社会经济生活中人与物的位移需求而生产出的产品,该产品具有显著的公共需求性与公益性。以公共产品理论为基础,从非排他性和非竞争性的角度可以判定交通基础设施具有公共产品属性,通过分析交通基础设施的消费机理深入探讨交通基础设施使用过程中产生拥挤现象的原因,可以否定交通基础设施为拥挤性公共产品的观点。此外,投资主体的变化不会变更交通基础设施的公共产品性质。     

Information,optimality and pollution control

A mechanism that provides for the efficient production of public goods suggested recently by Groves-Ledyard is reinterpreted as an efficient emissions' rights market scheme. A generalization of the Groves-Ledyard mechanism which Suchanek has shown to comprise an efficient emissions' quotas scheme is restated and then converted into an efficient emissions' charges scheme. The relationship between these schemes yields the standard duality of optimal emissions' charges and optimal emissions' quotas. This duality result is not as strong as one might believe. As an illustration, two emissions' charges schemes are presented each of which generates the charges dual to the optimal quotas given by the specified optimal emissions' quotas government but which are inefficient in general.     

农村公共物品多边治理机制研究——基于嵌套博弈的分析

解决农村公共物品效率问题应以多边治理思想代替简单的供给思想。农村公共物品治理不是一个孤立的博弈,而是嵌套在社会关系博弈之中。改变农村基层权力结构,建立以农户需求为导向、自下而上的公共物品决策体系,将形成有利于多边治理的博弈结构。在这种嵌套博弈中,农户、企业及非盈利组织都有参与农村公共物品治理的积极性,他们与村委会及各级政府共同建立起分工协调的多边治理机制,从而提高农村公共物品的治理效率。     

On commodity tax harmonization and public goods provision

This paper argues that Pareto improvements based on harmonizing tax reforms expressed in terms of the divergence between actual and optimal tax structures and over/under provision of public goods require the use of ‘pseudo-optimal’ taxes instead of optimal ones. ‘Pseudo-optimal’ taxes are defined as those obtained using the optimal tax formulas but evaluated at any arbitrary initial tax structure. Within this context the paper reconfirms existing results showing that tax harmonization emerges as a strong policy instrument in achieving a potential Pareto-improvement.     

效应溢出与地方公共产品供给的权限

基于地方公共产品理论,探讨了具有溢出效应的地区间地方公共产品最优供给效率,尝试性地测度了地方性公共产品不同的供给形态对帕累托效率的偏离,并在此基础上指出经济权限和政治权限的耦和是实现地方公共产品最优供给的重要途径,最后借助外部性内在化的理论分析框架探讨了实现经济权限和政治权限耦合的相应制度安排。     

Reducing Inefficiency in Public Good Provision Through Linking

We characterize the optimal mechanism for the provision of n public goods in an economy with m agents, binary valuations. The mechanism “links” the n problems together because decisions and transfers are based on the whole vector of valuations of the agents. In particular, the decision on whether or not to provide a public good depends not only on the valuations of the agents for that good but, in some cases, also on the valuations for the other goods reported by the low‐valuation agents. For the two‐agent case, we show that the mechanism is asymptotically efficient and we provide an example that compares its relative efficiency with optimal separate provision and with another asymptotically efficient mechanism in the literature.