Why and how a well-intended (local) government can hide information from citizens for their own good: The case of public goods provision in less developed areas

Maxime Agbo () and Agnes Zabsonre
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Maxime Agbo: School of Statistics, Planning and Demography, University of Parakou

Economics Bulletin, 2023, vol. 43, issue 1, 484 - 499

Abstract: In developing countries, particularly in African cities or rural areas, despite the existence of the free-riding phenomenon, it is common to see ordinary citizens being engaged in private initiative to produce a public good (roads repairing, makeshift bridges building, traffic regulation, etc.). This everyday observed fact reveals that preferences of agents are such that there is a minimal level of the public good under which the free-riding problem seems to vanish. In this paper, we develop a theoretical model that matches with this everyday reality in order to derive a development policy. Specifically, we revisit agents' preferences by considering a utility function that involves a satiation level. We find that, in a non-cooperative game, agents make their choice around the satiation level, and this outcome is socially optimal. As a policy implication for local authorities, before raising taxes, a better strategy could be to make citizens believe that the public good production is below the satiation level. We present the particular cases of public light provision and the management of inadequate occupation of public spaces.

Keywords: Public good; congestion; cooperative; satiation level; policy (search for similar items in EconPapers)
JEL-codes: H4 O2 (search for similar items in EconPapers)
Date: 2023-03-30
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