The composition of government expenditure with alternative choicemechanisms

John Creedy and Solmaz Moslehi ()

New Zealand Economic Papers, 2014, vol. 48, issue 1, 53-71

Abstract: This paper investigates the choice of the composition of government expenditure using both positive and normative approaches. The former involves aggregation over selfish voters (simple majority voting and stochastic voting are examined), while the latter involves the choice by a single disinterested individual (considered to maximise a social welfare function). The approach allows direct comparisons of the choice mechanisms. The structures examined include a transfer payment combined with a pure public good, and a transfer payment with tax-financed education. Explicit solutions are obtained for the choice of expenditure components, and these are shown to depend on the proportional difference between the arithmetic mean and another measure of location of incomes, where the latter depends on the choice mechanism. In each case the expenditure composition depends on an inequality measure defined in terms of the proportional difference between a measure of location of the income distribution and the arithmetic mean, where the location measure depends on the decision mechanism.

Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/00779954.2013.772878 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:nzecpp:v:48:y:2014:i:1:p:53-71

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RNZP20

DOI: 10.1080/00779954.2013.772878

Access Statistics for this article

New Zealand Economic Papers is currently edited by Dennis Wesselbaum

More articles in New Zealand Economic Papers from Taylor & Francis Journals
Bibliographic data for series maintained by ().