Public Spending and the Political Process

Toshihiro Ihori
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Toshihiro Ihori: National Gradual Institute for Policy Studies

Chapter 12 in Principles of Public Finance, 2017, pp 329-361 from Springer

Abstract: Abstract In the discussion about public goods, the rationale for public provision is the failure of the market. However, even if the market fails, it does not necessarily mean that the government must provide the goods. For example, if market failure is due to externality, the government may impose a Pigouvian tax and/or subsidy policy to ameliorate the failure. Namely, the government may intervene by using taxes and/or subsidies. The government does not have to provide the public goods; these may be provided by the private sector with appropriate tax and subsidy policies. It is difficult to judge whether the government or the private sector with some indirect intervention should provide impure public goods.

Keywords: Failure of government; Theory of public choice; Majority voting; Median voter theorem; Paradox of voting; Interest group; Convergence of policies; Political business cycle; Partisan business cycle; Change of government (search for similar items in EconPapers)
Date: 2017
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sptchp:978-981-10-2389-7_12

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DOI: 10.1007/978-981-10-2389-7_12

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