Democracy, Redistributive Taxation and the Private Provision of Public Goods
AbstractThe paper studies in a simple, Downsian model of political competition how the private provision of public goods is affected when it is embedded in a system of democracy and redistributive taxation. Results show that the positive effect of inequality on public goods production, which Olson (1965) pointed to, is weakened and might even be reversed in this context. Also, the median voter may choose a negative tax rate, even if he is poorer than the mean, in order to stimulate public goods production. The relevance of the model is illustrated with an application to the finance of higher education.
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Bibliographic InfoPaper provided by University of Copenhagen. Department of Economics in its series Discussion Papers with number 10-09.
Length: 17 pages
Date of creation: Mar 2010
Date of revision:
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More information through EDIRC
public goods; political economy; inequality; taxation; higher education;
Other versions of this item:
- Markussen, Thomas, 2011. "Democracy, redistributive taxation and the private provision of public goods," European Journal of Political Economy, Elsevier, vol. 27(1), pages 201-213, March.
- D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
- D7 - Microeconomics - - Analysis of Collective Decision-Making
- H2 - Public Economics - - Taxation, Subsidies, and Revenue
- H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
- I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-03-28 (All new papers)
- NEP-PBE-2010-03-28 (Public Economics)
- NEP-POL-2010-03-28 (Positive Political Economics)
- NEP-PUB-2010-03-28 (Public Finance)
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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