Abstract
In this paper, I consider a large economy with a private and a public good where the distribution of costs (but not the individual costs) associated with the provision of the public good is known. A simple tax-subsidy policy, whereby all contributors get a subsidy funded by a tax on non-contributors, is shown to attain the first best allocation provided that the socially optimal amount of the public good is independent of the distribution of individual costs.
| Original language | English |
|---|---|
| Pages (from-to) | 229-234 |
| Number of pages | 6 |
| Journal | Economics Letters |
| Volume | 61 |
| Issue number | 2 |
| DOIs | |
| State | Published - 1 Nov 1998 |
Keywords
- H4
- Provision of public goods
ASJC Scopus subject areas
- Finance
- Economics and Econometrics