Publicly provided private goods and redistribution: A General equilibrium analysis

Jukka Pirttilä and Matti Tuomala

No 103, Working Papers from Tampere University, Faculty of Management and Business, Economics

Abstract: This paper focuses on two sets of impacts of public provision of private goods that have been neglected in the self-selection framework of optimal taxation, the by-now standard approach in examining public provision. We first show, using a general formulation whereby production depends on labour supply of different households and the level of public provision, that there can be a role for public provision because of productivity and wage-structure effects, even if preferences are weakly separable between goods and leisure. Second, we deal with a specific example of public provision of education that provides an intuitively appealing case for the production side impacts. Finally, we address the role of public provision in a dynamic, overlapping generations, economy, whereby public provision may affect efficiency and social costs of redistribution of future generations as well, opening up a way to combine inter- and intra-generational impacts of public provision.

Keywords: optimal taxation; public provision; education; overlapping generations (search for similar items in EconPapers)
Pages: 23 pages
Date: 2001-06
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Published in The Scandinavian Journal of Economics, Volume 104, Issue 1 (March 2002)

Downloads: (external link)
http://urn.fi/urn:isbn:951-44-5131-7 First version, 2001 (application/pdf)

Related works:
Journal Article: Publicly Provided Private Goods and Redistribution: A General Equilibrium Analysis (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:tam:wpaper:0103

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