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The Provision of Local Public Services in a Risky Environment: An Application to Crime

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  • Traub, Stefan

Abstract

We state efficiency conditions for the provision of congestable local public goods that diminish individual-specific proprietary risks. The optimum level of such a public service is determined by equating the sum of the reductions of the expected property losses due to a better service level with the marginal costs of the service. The optimum size of the providing local authority in terms of population is obtained where the increase in proprietary risks due to congestion meets the decrease in contributions for the original citizens. As an empirical example, we employ Germany?s crime statistic in order to assess the efficiency of the provision of police services at the state level. --

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Bibliographic Info

Paper provided by Christian-Albrechts-University of Kiel, Department of Economics in its series Economics Working Papers with number 2006,03.

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Date of creation: 2006
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Handle: RePEc:zbw:cauewp:4135

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Keywords: Local Public Goods; Congestion; Risk; Crime; Police;

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  1. Bergstrom, Theodore C & Goodman, Robert P, 1973. "Private Demands for Public Goods," American Economic Review, American Economic Association, vol. 63(3), pages 280-96, June.
  2. Entorf, Horst & Spengler, Hannes, 2000. "Socio-economic and demographic factors of crime in Germany: evidence from panel data of the German States," Publications of Darmstadt Technical University, Institute of Economics (VWL) 24110, Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute of Economics (VWL).
  3. McGuire, Martin, 1974. "Group Segregation and Optimal Jurisdictions," Journal of Political Economy, University of Chicago Press, vol. 82(1), pages 112-32, Jan.-Feb..
  4. Lohse, Tim & Julio R. Robledo & Ulrich Schmidt, 2006. "Self-Insurance and Self-Protection as Public Goods," Diskussionspapiere der Wirtschaftswissenschaftlichen Fakultät der Leibniz Universität Hannover dp-354, Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät.
  5. Thiess Buettner, 2003. "Local Determinants of Crime: Distinguishing Between Resident and Non-resident Offenders," ERSA conference papers ersa03p396, European Regional Science Association.
  6. Steven D. Levitt, 1995. "Using Electoral Cycles in Police Hiring to Estimate the Effect of Policeon Crime," NBER Working Papers 4991, National Bureau of Economic Research, Inc.
  7. Bewley, Truman F, 1981. "A Critique of Tiebout's Theory of Local Public Expenditures," Econometrica, Econometric Society, vol. 49(3), pages 713-40, May.
  8. Reiter, Michael & Weichenrieder, Alfons J., 1999. "Public Goods, Club Goods, and the Measurement of Crowding," Journal of Urban Economics, Elsevier, vol. 46(1), pages 69-79, July.
  9. Holcombe, Randall G & Sobel, Russell S, 1995. " Empirical Evidence on the Publicness of State Legislative Activities," Public Choice, Springer, vol. 83(1-2), pages 47-58, April.
  10. Drake, Leigh M. & Simper, Richard, 2005. "Police Efficiency in Offences Cleared: An Analysis of English "Basic Command Units"," International Review of Law and Economics, Elsevier, vol. 25(2), pages 186-208, June.
  11. Spengler, Hannes, 2004. "Ursachen und Kosten der Kriminalität in Deutschland : drei empirische Untersuchungen," Publications of Darmstadt Technical University, Institute of Economics (VWL) 22827, Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute of Economics (VWL).
  12. Ehrlich, Isaac & Becker, Gary S, 1972. "Market Insurance, Self-Insurance, and Self-Protection," Journal of Political Economy, University of Chicago Press, vol. 80(4), pages 623-48, July-Aug..
  13. Ehrlich, Isaac, 1973. "Participation in Illegitimate Activities: A Theoretical and Empirical Investigation," Journal of Political Economy, University of Chicago Press, vol. 81(3), pages 521-65, May-June.
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