The Genealogy of Modern Theoretical Public Economics: From First Best to Second Best

Roger Guesnerie ()

No 76, CESifo Working Paper Series from CESifo

Abstract: The development of second best modelling in the seventies has shaped modern theoretical public economics. The paper discusses some key changes in the economists' conceptions. The first two sections examine the efficiency- equity dilemma. The study of non convexities has shown that counterintuitive "efficiency enhancing" income redistribution might occur. The introduction of asymmetric information has shed doubts on virtues of lump-sum compensation. The last sections focus on the intricate geometry of second best optimisation and the ambiguous value of the signals provided by the price system outside a first best world.

Keywords: public economics; non convexities; second best; asymetric information; shadow prices (search for similar items in EconPapers)
Date: 1994
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.cesifo.org/DocDL/ces_wp76.pdf (application/pdf)

Related works:
Journal Article: The genealogy of modern theoretical public economics: From first best to second best (1995)
Working Paper: The Genealogy of Modern Theoretical Public Economics: From first best to second best (1994)
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:ces:ceswps:_76

Access Statistics for this paper

More papers in CESifo Working Paper Series from CESifo Contact information at EDIRC.
Bibliographic data for series maintained by Klaus Wohlrabe ().