Distributed Public Economics and Decentralized Public Finance via Network Optimization

Ioannis Papastaikoudis, Prodromos Prodromidis, Jeremy Watson and Ioannis Lestas

Cambridge Working Papers in Economics from Faculty of Economics, University of Cambridge

Abstract: We propose a new approach in public economics in a decentralized finance setting by using distributed optimization techniques for the planning of inter-regional and intra-regional public works/services for multiple regions each one with its own budget, natural and population characteristics. The goal of this study is to provide a toolkit for the planning of vast public works/services in an optimal way across the regions in order to improve the welfare of their respective populations. The proposed optimization approach can assist the government regarding its policy making for the public infrastructure, e.g., in the prioritization of the various public units across regions and also in the optimal geographical allocation of them. We will interpret the problem as a utility maximization problem and we will calculate the Marshallian demand for the public infrastructure.

Keywords: Network Optimization; Public Economics; public finance (search for similar items in EconPapers)
JEL-codes: C61 C62 D11 D30 D85 H40 H70 (search for similar items in EconPapers)
Date: 2025-01-22
New Economics Papers: this item is included in nep-upt
Note: ip352
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Persistent link: https://EconPapers.repec.org/RePEc:cam:camdae:2503

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