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Dynamic Voluntary Provision of Public Goods and Optimal Steady‐State Subsidies

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  • AKIHIKO YANASE

Abstract

This paper examines a differential game model of voluntary provision of a public good in which private agents' contributions accumulate over time and derives subsidy rules that achieve the socially efficient steady state. It is shown that the optimal subsidy rule is a simple one when agents use the open‐loop strategy, while under Markovian strategies it intricately depends on the parameters of the economy.

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  • Akihiko Yanase, 2006. "Dynamic Voluntary Provision of Public Goods and Optimal Steady‐State Subsidies," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 8(1), pages 171-179, January.
    • Handle: RePEc:bla:jpbect:v:8:y:2006:i:1:p:171-179
    DOI: 10.1111/j.1467-9779.2006.00258.x
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    References listed on IDEAS

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    10. Akihisa Shibata, 2002. "Strategic Interactions in a Growth Model with Infrastructure Capital," Metroeconomica, Wiley Blackwell, vol. 53(4), pages 434-460, November.
    11. Wirl, Franz, 1996. "Dynamic voluntary provision of public goods: Extension to nonlinear strategies," European Journal of Political Economy, Elsevier, vol. 12(3), pages 555-560, November.
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    Cited by:

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    3. Colombo, Luca & Labrecciosa, Paola & Van Long, Ngo, 2022. "A dynamic analysis of international environmental agreements under partial cooperation," European Economic Review, Elsevier, vol. 143(C).
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    5. Huang, Yuankan & Inohara, Takehiro, 2015. "Steady-state stock and group size: An approach of dynamic voluntary provisions of public goods," Applied Mathematics and Computation, Elsevier, vol. 270(C), pages 505-510.
    6. Tamai, Toshiki, 2018. "Dynamic provision of public goods under uncertainty," Economic Modelling, Elsevier, vol. 68(C), pages 409-415.

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