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Equitable provision of long-term public goods: the role of negotiation mandates

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Author Info
Lecocq, Franck
Hourcade, Jean-Charles

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Abstract

In a one-period model, whether or not individual weights in the welfare function are based on initial endowments dictate who provides public goods. But with long-term public goods, banning wealth redistribution still allows for several equilibriums depending on Parties'willingness to acknowledge changes in negotiating powers over time, and on whether or not they care only for their own descendants. Adaptative and universal mandates lead to far more robust equilibrium. In all cases, a simple rule of thumb for allocating expenditures at first period emerges, independent of both the optimal level of public goods and the second-period distribution of expenditures.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 3180.

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Date of creation: 01 Dec 2003
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Handle: RePEc:wbk:wbrwps:3180

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Keywords: Montreal Protocol; Economic Theory&Research; Information Technology; Environmental Economics&Policies; General Technology; Montreal Protocol; Economic Theory&Research; Environmental Economics&Policies; Energy and Environment; Transport and Environment;

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  1. Guesnerie, R., 1995. "The genealogy of modern theoretical public economics: From first best to second best," European Economic Review, Elsevier, vol. 39(3-4), pages 353-381, April. [Downloadable!] (restricted)
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  2. Christian Azar, 1999. "Weight Factors in Cost-Benefit Analysis of Climate Change," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 13(3), pages 249-268, April. [Downloadable!] (restricted)
  3. Schelling, Thomas C, 1995. "Intergenerational discounting," Energy Policy, Elsevier, vol. 23(4-5), pages 395-401. [Downloadable!] (restricted)
  4. Sandler, Todd & Smith, V. Kerry, 1976. "Intertemporal and intergenerational Pareto efficiency," Journal of Environmental Economics and Management, Elsevier, vol. 2(3), pages 151-159, February. [Downloadable!] (restricted)
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