Publicly Provided Private Goods and Redistribution: A General Equilibrium Analysis
Public provision of private goods is examined within a self-selection framework where production depends on labor supply of different households and the level of public provision. It is shown that productivity and wage-structure effects can create a role for public provision, even if preferences are weakly separable between goods and leisure. Public provision of education may offer an intuitively appealing case for the production-side impacts. We also address the reasons for public provision in a dynamic, overlapping generations economy, whereby public provision may affect efficiency and social costs of redistribution of future generations as well. Copyright 2002 by The editors of the Scandinavian Journal of Economics.
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Volume (Year): 104 (2002)
Issue (Month): 1 ()
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