Regional income disparity and the size of the Public Sector

Michele Giuranno

POLIS Working Papers from Institute of Public Policy and Public Choice - POLIS

Abstract: This paper focuses on the question of how income inequality between two jurisdictions impacts upon government decision-making affecting the size of the public sector. We model policy choices as the outcome of regional representatives'negotiations in the legislature. We show that the more unequal inter-regional income distribution is, the greater the under-provision of public goods. Particularly, larger inter-regional income disparity leads to a smaller public sector. A wealthier economy as a result may have a relatively smaller government size when income disparity increases.

Pages: 26 pages
Date: 2008-11
New Economics Papers: this item is included in nep-geo and nep-pbe
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Citations: View citations in EconPapers (7)

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Related works:
Journal Article: Regional Income Disparity and the Size of the Public Sector (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:uca:ucapdv:114

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