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Further Analysis on Public-Good Provision in a Repeated-Game Setting

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  • Keisuke Kawachi
  • Hikaru Ogawa
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    Abstract

    In a model of privately provided public goods within a repeated-game setting, Pecorino (1999) shows that it is not only possible to maintain cooperation, but it is "easy" in a large economy. Models of privately provided public goods are closely related to interregional tax competition models with spillovers in public-good provision. This paper reexamines the argument of Pecorino in an infinitely repeated interaction model of interregional tax competition. The results show that in a large economy, while the trigger strategy supports the efficient tax rate if there exists substantial spillover of public goods, it fails to do so if there are few benefit spillovers.

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    Bibliographic Info

    Article provided by Mohr Siebeck, Tübingen in its journal FinanzArchiv.

    Volume (Year): 62 (2006)
    Issue (Month): 3 (September)
    Pages: 339-352

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    Handle: RePEc:mhr:finarc:urn:sici:0015-2218(200609)62:3_339:faoppi_2.0.tx_2-r

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    Related research

    Keywords: voluntary provision; tax competition; spillovers; group size; repeated game;

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    References

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    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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    1. Bjorvatn, K. & Schjelderup, G., 2000. "Tax Competition and International Public Goods," Papers 15/00, Norwegian School of Economics and Business Administration-.
    2. Pecorino, Paul, 1999. "The effect of group size on public good provision in a repeated game setting," Journal of Public Economics, Elsevier, vol. 72(1), pages 121-134, April.
    3. Hoyt, William H., 1991. "Property taxation, Nash equilibrium, and market power," Journal of Urban Economics, Elsevier, vol. 30(1), pages 123-131, July.
    4. Boadway, Robin & Hayashi, Masayoshi, 1999. "Country size and the voluntary provision of international public goods," European Journal of Political Economy, Elsevier, vol. 15(4), pages 619-638, November.
    5. WILDASIN, David E., . "Interjurisdictional capital mobility: Fiscal externality and a corrective subsidy," CORE Discussion Papers RP -831, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    6. R. M. Isaac & J. M. Walker, 2010. "Group size effects in public goods provision: The voluntary contribution mechanism," Levine's Working Paper Archive 310, David K. Levine.
    7. Cardarelli, Roberto & Taugourdeau, Emmanuelle & Vidal, Jean-Pierre, 2002. " A Repeated Interactions Model of Tax Competition," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 4(1), pages 19-38.
    8. Ratna K. Shrestha & James P. Feehan, 2002. "Contributions to International Public Goods and the Notion of Country Size," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 59(4), pages 551-, December.
    9. Tilman Klumpp, 2012. "Finitely Repeated Voluntary Provision of a Public Good," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 14(4), pages 547-572, 08.
    10. Kemp, Murray C., 1984. "A note of the theory of international transfers," Economics Letters, Elsevier, vol. 14(2-3), pages 259-262.
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