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Why not in your backyard? On the location and size of a public facility

Author

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  • Bellettini, Giorgio
  • Kempf, Hubert

Abstract

In this paper, we tackle the issue of locating and sizing a public facility which provides a public good in a closed and populated territory and generates differentiated benefits to households. In the case of a “Nimby” (“Imby”) facility, the smaller is the distance, the smaller (larger) is the individual benefit. Multiple solutions may arise in both cases, and we derive sufficient conditions for uniqueness in both cases. Optimal decisions on location and size are interrelated and depend on the complementarity or substitutability properties of size and distance in the utility function. Then we introduce a common-agency lobbying game, where agents attempt to influence the location and provision decisions by the government. Even when only a subset of households lobbies, the solution of the lobbying game can replicate the optimal solution. Under-provision or over-provision of the public good may be obtained both in the Nimby and the Imby cases. Finally, some non-lobbying households may be better off than in the case where all households lobby, which raises the possibility of free-riding at the lobbying stage.

Suggested Citation

  • Bellettini, Giorgio & Kempf, Hubert, 2013. "Why not in your backyard? On the location and size of a public facility," Regional Science and Urban Economics, Elsevier, vol. 43(1), pages 22-30.
  • Handle: RePEc:eee:regeco:v:43:y:2013:i:1:p:22-30
    DOI: 10.1016/j.regsciurbeco.2012.11.001
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    References listed on IDEAS

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    Cited by:

    1. Ghidoni, Riccardo, 2017. "Mistrust and Opposition to Large-Scale Projects : An Experiment on the Role of Uncertainty," Discussion Paper 2017-053, Tilburg University, Center for Economic Research.
    2. repec:eee:transe:v:112:y:2018:i:c:p:1-11 is not listed on IDEAS
    3. Gabriel M. Ahlfeldt, 2011. "The Train has Left the Station: Do Markets Value Intracity Access to Intercity Rail Connections?," German Economic Review, Verein für Socialpolitik, vol. 12(3), pages 312-335, August.
    4. Polk, Andreas & Schmutzler, Armin & Müller, Adrian, 2014. "Lobbying and the power of multinational firms," European Journal of Political Economy, Elsevier, vol. 36(C), pages 209-227.

    More about this item

    Keywords

    Facility location; Nimby; Lobbies;

    JEL classification:

    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R53 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Public Facility Location Analysis; Public Investment and Capital Stock

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