Majority Rule and the Public Provision of a Private Good
This paper extends the literature on the socialization of commodities by developing a model of voting over the public provision of a private good: health care. The private use of health care is modeled as a supplement rather than as an exclusive alternative to public health care. A majority rule equilibrium is shown to exist. The equilibrium characterization is an example of Director's law of income redistribution. A ban on private health care activities is shown to be opposed by a majority of voters. Implications for the size and distribution of private health care expenditures are drawn. Copyright 1997 by Kluwer Academic Publishers
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