Leviathan and pure public goods in a federation with mobile populations

Chikara Yamaguchi
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Chikara Yamaguchi: Hokkaido University, http://www.econ.hokudai.ac.jp/en/

Journal of Applied Economics, 2004, vol. 7, 369-389

Abstract: This paper investigates properties of the second best allocation in a federation where regional governments provide a pure public good non-cooperatively and policy makers are neither entirely benevolent nor wholly self-serving. A high degree of household mobility across regions forces the governments to raise the efficiency of the public good, however, it also helps to waste resources. It is shown that regional Leviathans not only under-provide the public good but also decrease the amount of wasteful expenditures as households become less mobile. Central governmentÂ’s intervention can enhance efficiency if households are attached to particular regions.

Keywords: Pure public goods; Leviathan; household mobility (search for similar items in EconPapers)
JEL-codes: H70 H77 (search for similar items in EconPapers)
Date: 2004
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:cem:jaecon:v:7:y:2004:n:2:p:369-389

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