When Samuelson Met Veblen Abroad: National and Global Public Good Provision when Social Comparisons Matter

Thomas Aronsson () and Olof Johansson-Stenman ()
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Thomas Aronsson: Department of Economics, Umeå University, Postal: S 901 87 Umeå, Sweden

No 843, Umeå Economic Studies from Umeå University, Department of Economics

Abstract: This paper derives Pareto efficient policy rules for the provision of national as well as global public goods in a two-country world, where each individual cares about relative consumption within as well as between countries. Furthermore, we compare these policy rules with those that follow from a non-cooperative Nash equilibrium. The results show that both global and national public goods are systematically under-provided in Nash equilibrium under such relative consumption concerns.

Keywords: Public goods; relative consumption; inter-jurisdictional comparison; status; positional goods (search for similar items in EconPapers)
JEL-codes: D03 D62 H40 (search for similar items in EconPapers)
Pages: 21 pages
Date: 2012-08-16
New Economics Papers: this item is included in nep-pke and nep-pub
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Related works:
Journal Article: When Samuelson Met Veblen Abroad: National and Global Public Good Provision when Social Comparisons Matter (2014)
Working Paper: When Samuelson met Veblen abroad: National and global public good provision when social comparisons matter (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:hhs:umnees:0843

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