A mechanism design approach to the Tiebout hypothesis

Philippe Jehiel () and Laurent Lamy

No 10758, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We revisit the Tiebout hypothesis in a world in which agents may possess private information as to how they value the various public goods in the various locations, and jurisdictions are free to choose whatever mechanism to attract citizens possibly after making some investments. It is shown that efficiency can be achieved as a competitive equilibrium when jurisdictions seek to maximize local revenues but not necessarily when they seek to maximize local welfare. Limitations of the result are discussed.

Keywords: Competing exchange platforms; Competing mechanisms; Endogenous entry; Free riding; Local public goods; Mechanism design; Tiebout hypothesis (search for similar items in EconPapers)
JEL-codes: D82 H4 (search for similar items in EconPapers)
Date: 2015-08
New Economics Papers: this item is included in nep-cta, nep-mic and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Related works:
Journal Article: A Mechanism Design Approach to the Tiebout Hypothesis (2018)
Working Paper: A mechanism design approach to the Tiebout Hypothesis (2018)
Working Paper: A mechanism design approach to the Tiebout Hypothesis (2018)
Working Paper: A mechanism design approach to the Tiebout hypothesis (2017)
Working Paper: A mechanism design approach to the Tiebout hypothesis (2017)
Working Paper: A mechanism design approach to the Tiebout hypothesis (2017)
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