Common Agency and Coordination: General Theory and Application to Tax Policy

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Common Agency and Coordination: General Theory and Application to Tax Policy

Author Info

Dexit, A.
Grossman, G.M.
Helpman, E.

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Abstract

We develop a model of common agency with complete information and general preferences with non-transferable utility, and prove that the principals'Nash equilibrium in truthful strategies implements an efficient action. We apply this theory to construct a positive model of public finance, where organized special interests acan lobby the government for consumer and producer taxes or subsidies and targeted lump-sum taxes or transfers.

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Paper provided by Tel Aviv in its series Papers with number 11-96.

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Length: 31 pages
Date of creation: 1996
Date of revision:
Handle: RePEc:fth:teavfo:11-96

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Paper
- Dixit, A. & Helpman, E., 1996. "Common Agency and Coordination: General Theory and Application to Tax Policy," Papers 179, Princeton, Woodrow Wilson School - Public and International Affairs.
- Dixit, Avinash K & Grossman, Gene & Helpman, Elhanan, 1996. "Common Agency and Coordination: General Theory and Application to Tax Policy," CEPR Discussion Papers 1436, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)

Find related papers by JEL classification:
D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
C79 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Other

Cited by:
(explanations, 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.)

Sajal Lahiri & Pascalis Raimondos-Møller, 1999. "Lobbying by Ethnic Groups and Aid Allocation," EPRU Working Paper Series 99-05, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics, revised Oct 2003. [Downloadable!]
Other versions:
- Lahiri, Sajal & Raimondos-Moller, Pascalis, 2000. "Lobbying by Ethnic Groups and Aid Allocation," Economic Journal, Royal Economic Society, vol. 110(462), pages C62-79, March. [Downloadable!] (restricted)
Schleich, Joachim & Orden, David, 1996. "Efficient choice among domestic and trade policies in the Grossman-Helpman Interest-Group Model," Bulletins 7458, University of Minnesota, Economic Development Center. [Downloadable!]
Cecilia Testa, 2003. "Government Corruption and Legislative Procedures: is One Chamber Better Than Two?," STICERD - Development Economics Papers 41, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE. [Downloadable!]
Cecilia Testa, 2001. "Reform, Lobbies and Welfare: A Common Agency Approach," Royal Holloway, University of London: Discussion Papers in Economics 01/6, Department of Economics, Royal Holloway University of London, revised Dec 2001. [Downloadable!]
Other versions:
- Cecilia Testa, 2005. "Reforms, lobbies and welfare: A common agency approach," Public Choice, Springer, vol. 125(3), pages 305-337, December. [Downloadable!] (restricted)
Marcel Vaillant, 1998. "Endogenous number of lobby groups in a specific factor trade model," Documentos de Trabajo (working papers) 0198, Department of Economics - dECON. [Downloadable!]
Stephen Coate, 1999. "An Efficiency Approach to the Evaluation of Policy Changes," NBER Working Papers 7316, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
Other versions:
- Coate, Stephen, 2000. "An Efficiency Approach to the Evaluation of Policy Changes," Economic Journal, Royal Economic Society, vol. 110(463), pages 437-55, April. [Downloadable!] (restricted)
Francisco Rodriguez, 1999. "Inequality, Redistribution and Rent-Seeking," Electronic Working Papers 99-006, University of Maryland, Department of Economics. [Downloadable!]
Other versions:
- Francisco Rodríguez, 2004. "Inequality, Redistribution, And Rent-Seeking," Economics and Politics, Blackwell Publishing, vol. 16, pages 287-320, November. [Downloadable!] (restricted)
Cecilia Testa, 2003. "Do candidates serve parties interests? Party Polarization as a discipline device," Royal Holloway, University of London: Discussion Papers in Economics 03/13, Department of Economics, Royal Holloway University of London, revised Dec 2003. [Downloadable!]
Lahiri, Sajal & Raimondos-Møller, Pascalis, 2000. "Special Interest Politics and Aid Fungibility," CEPR Discussion Papers 2482, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)

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