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Household Nash equilibrium with voluntarily contributed public goods

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  • Valérie Lechene

    (Institute for Fiscal Studies and University College London)

  • Ian Preston

    ()
    (Institute for Fiscal Studies and University College London)

Abstract

We study noncooperative models with two agents and several voluntarily contributed public goods. We focus on interior equilibria in which neither agent is bound by non negativity constraints, establishing the conditions for existence and uniqueness of the equilibrium. While adding-up and homogeneity hold, negativity and symmetry properties are generally violated. We derive the counterpart to the Slutsky matrix, and show that it can be decomposed into the sum of a symmetric and negative semidefinite matrix and another the rank of which never exceeds the number of public goods plus one. Under separability of the public goods the deviation from symmetry is at most rank two.

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Bibliographic Info

Paper provided by Institute for Fiscal Studies in its series IFS Working Papers with number W05/06.

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Length: 33 pp.
Date of creation: Mar 2005
Date of revision:
Handle: RePEc:ifs:ifsewp:05/06

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Keywords: Nash equilibrium; Intra-household allocation; Slutsky;

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References

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  4. Browning, M. & Bourguignon, F. & Chiappori, P.A. & Lechene, V., 1992. "Incomes and Outcomes: A structural Model of Intra-Household Allocation," DELTA Working Papers 92-23, DELTA (Ecole normale supérieure).
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Citations

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Cited by:
  1. Claude d’Aspremont & Rodolphe Dos Santos Ferreira, 2009. "Household behavior and individual autonomy," Working Papers of BETA 2009-17, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
  2. Marcel Fafchamps & Agnes R. Quisumbing, 2006. "Household Formation and Marriage Markets," Economics Series Working Papers GPRG-WPS-039, University of Oxford, Department of Economics.
  3. Martin Browning & Pierre-André Chiappori & Valérie Lechene, 2010. "Distributional Effects in Household Models: Separate Spheres and Income Pooling," Economic Journal, Royal Economic Society, vol. 120(545), pages 786-799, 06.
  4. Lechene, Valérie & Preston, Ian, 2011. "Noncooperative household demand," Journal of Economic Theory, Elsevier, vol. 146(2), pages 504-527, March.
  5. D’ASPREMONT, Claude & DOS SANTOS FERREIRA, Rodolphe, 2012. "Household behavior and individual autonomy: An extended Lindahl mechanism," CORE Discussion Papers 2012014, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  6. Valerie Lechene & Martin Browning, 2006. "Quelques resultats sur l`effet des transferts cibles," Economics Series Working Papers 294, University of Oxford, Department of Economics.
  7. Valérie Lechene & Ian Preston, 2007. "Demand properties in household Nash equilibrium," IFS Working Papers W07/01, Institute for Fiscal Studies.
  8. Castilla, Carolina, 2010. "Intra-Household Resource Management Structure and Income-Hiding under Incomplete Information," 2010 Annual Meeting, July 25-27, 2010, Denver, Colorado 61607, Agricultural and Applied Economics Association.

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