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The Egalitarian sharing rule in provision of public goods

  • Shlomo Wever

    ()

    (CORE and SMU)

  • Alexei Savvateev

    ()

    (CORE)

  • Michel Le Breton

    ()

    (GREMAQ and IDEI, University of Toulouse 1)

  • Anna Bogomolnaia

    ()

    (Department of Economics, Rice University)

In this note we consider a society that partitions itself into disjoint jurisdictions, each choosing a location of its public project and a taxation scheme to finance it. The set of public project is multi-dimensional, and their costs could vary from jurisdiction to jurisdiction. We impose two principles, egalitarianism, that requires the equalization of the total cost for all agents in the same jurisdiction, and efficiency, that implies the minimization of the aggregate total cost within jurisdiction. We show that these two principles always yield a core-stable partition but a Nash stable partition may fail to exist. We demonstrate moreover that stable partitions are not necessarily consecutive.

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Article provided by AccessEcon in its journal Economics Bulletin.

Volume (Year): 8 (2005)
Issue (Month): 11 ()
Pages: 1-5

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Handle: RePEc:ebl:ecbull:eb-05h40002
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  1. Greenberg, Joseph & Weber, Shlomo, 1986. "Strong tiebout equilibrium under restricted preferences domain," Journal of Economic Theory, Elsevier, vol. 38(1), pages 101-117, February.
  2. Tayfun Sönmez & Suryapratim Banerjee & Hideo Konishi, 2001. "Core in a simple coalition formation game," Social Choice and Welfare, Springer, vol. 18(1), pages 135-153.
  3. Jehiel, Philippe & Scotchmer, Suzanne, 2001. "Constitutional Rules of Exclusion in Jurisdiction Formation," Review of Economic Studies, Wiley Blackwell, vol. 68(2), pages 393-413, April.
  4. Bogomolnaia, Anna & Jackson, Matthew O., 2002. "The Stability of Hedonic Coalition Structures," Games and Economic Behavior, Elsevier, vol. 38(2), pages 201-230, February.
  5. Le Breton, Michel & Weber, Shlomo, 2003. "The Art of Making Everybody Happy : How to Prevent a Secession," IDEI Working Papers 164, Institut d'Économie Industrielle (IDEI), Toulouse.
  6. Michel Le Breton & Shlomo Weber, 2003. "The Art of Making Everybody Happy: How to Prevent a Secession," IMF Staff Papers, Palgrave Macmillan, vol. 50(3), pages 4.
  7. Dreze, Jacques & Le Breton, Michel & Weber, Shlomo, 2004. "The Rawslian Principle and Secession-Proofness in Large Heterogeneous Societies," IDEI Working Papers 283, Institut d'Économie Industrielle (IDEI), Toulouse.
  8. Alesina, Alberto & Spolaore, Enrico, 1997. "On the Number and Size of Nations," The Quarterly Journal of Economics, MIT Press, vol. 112(4), pages 1027-56, November.
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