Efficient provision of public goods with endogenous redistribution
Luca Anderlini and
Discussion Paper Series In Economics And Econometrics from University of Southampton, Economics Division, School of Social Sciences
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 are re-allocated so that the chosen vector of Lindahl prices is indeed a Lindahl equilibrium, and implements the corresponding Lindahl allocation. Previously known mechanisms that implement the Lindahl correspondence do not allow the Government to choose which point on the Pareto frontier should be implemented, unless it can also redistribute initial endowments in the appropriate way. By contrast, in our case the Government directly controls the distribution of welfare in the economy. Finally, besides being balanced and continuous, our mechanism is `simple'. Each agent has to declare a desired increase in the amount of public good, and a vector of redistributive transfers of initial endowments (across other agents).
References: View references in EconPapers View complete reference list from CitEc
Citations Track citations by RSS feed
Downloads: (external link)
Journal Article: Efficient provision of public goods with endogenous redistribution (2004)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: /RePEc:stn:sotoec:9912
Access Statistics for this paper
More papers in Discussion Paper Series In Economics And Econometrics from University of Southampton, Economics Division, School of Social Sciences
Contact information at EDIRC.
Series data maintained by Chris Thorn ().