On strong independence of allocative efficiency from distribution in the theory of public goods

Norman L. Kleinberg, Barry K. Ma and Jeffrey H. Weiss

Economics Letters, 2012, vol. 116, issue 3, 343-345

Abstract: We extend Bergstrom and Cornes (1983) to show that for strong independence of efficient allocations from distribution in a public goods economy, the utility functions of all consumers must identically be of the form: A(Y)Xi, where Y and Xi are respectively the quantities of public good and private good for consumer i, and A(⋅) is some arbitrary function. This implies that for an economy with heterogeneous consumer preferences, it is impossible to ensure that any redistribution of private goods will remain efficient, especially for boundary Pareto optima.

Keywords: Public goods; Independence; Efficiency; Income distribution (search for similar items in EconPapers)
JEL-codes: D11 D30 D61 H41 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:116:y:2012:i:3:p:343-345

DOI: 10.1016/j.econlet.2012.04.004

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