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Electoral Competition and Incentives to Local Public Good Provision

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  • M. Magnani

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Abstract

Local public good provision from different government levels is subject to many bias coming from the political process; incentives indeed, vary with the size of the beneficiaries’ set and costs may affect the results of political competition by reducing total resources available for redistribution. Present work represents a first attempt to look at these issues together; indeed, it considers the situation where politicians have a finite budget to use both for redistributive policies and for the provision of a public good that affects the utility of a fraction of the electorate. In this setting it is not enough that benefits balance costs, in order for the public good to be implemented; the required level of efficiency moreover, is influenced by benefits concentration. If those interested in the public good are less than half of the electorate, concentration increases the efficiency threshold; on the contrary if they amount for more, benefits concentration decreases the required level of efficiency. Classification-JEL: D72, H41

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Bibliographic Info

Paper provided by Department of Economics, Parma University (Italy) in its series Economics Department Working Papers with number 2006-EP13.

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Length: 37 pages
Date of creation: 2006
Date of revision:
Handle: RePEc:par:dipeco:2006-ep13

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Keywords: social security; turnover on the labor market; political equilibria; employment protection; retirement age;

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  1. Baye, M.R. & Kovenock, D. & De Vries, C.G., 1991. "Rigging The Lobbying Process: An Application Of The All- Pay Auction," Purdue University Economics Working Papers 1002, Purdue University, Department of Economics.
  2. Ellingsen, T., 1990. "Strategic Buyers and the Social Cost of Monopoly," Papers 05-90, Norwegian School of Economics and Business Administration-.
  3. Bertoletti, Paolo, 2006. "On the reserve price in all-pay auctions with complete information and lobbying games," MPRA Paper 1083, University Library of Munich, Germany.
  4. Nicolas Sahuguet & Nicola Persico, 2006. "Campaign spending regulation in a model of redistributive politics," Economic Theory, Springer, vol. 28(1), pages 95-124, 05.
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