Collective Goods and the Political Hold-Up Problem
AbstractBy extending the incomplete-contract model to the provision of local collective goods, this paper analyzes the political hold-up problem in urban land use. The model focuses on three-party contractual relationships and analyzes the effects of wage and rent capitalization, symmetric or asymmetric. The findings indicate that, in the face of uncertainty in collective-goods provision, it is efficient to integrate landowner and collective-goods provider, as demonstrated by the growth of the ground lease system and common-interest developments in recent decades. Rent capitalization further strengthens the result. Similarities and differences between urban institutions and the firm are also discussed.
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Bibliographic InfoArticle provided by Mohr Siebeck, Tübingen in its journal Journal of Institutional and Theoretical Economics.
Volume (Year): 159 (2003)
Issue (Month): 2 (June)
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Find related papers by JEL classification:
- D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
- H70 - Public Economics - - State and Local Government; Intergovernmental Relations - - - General
- R52 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Land Use and Other Regulations
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- Deng, Feng, 2008. "What Is “Open”? An Economic Analysis of Open Institutions," MPRA Paper 8888, University Library of Munich, Germany.
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