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When Does Majority Rule Supply Public Goods Efficiently?

In: Measurement in Public Choice

Author

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  • Ted C. Bergstrom

Abstract

H.R. Bowen showed that majority voting leads to a Pareto efficient supply of a single public good if all voters have equal tax shares and if marginal rates of substitution for the public good are symmetrically distributed in the voting population. In general however, even if preferences are identical and tax shares equal, majority voting is not Pareto efficient if income is asymmetrically distributed. Here we formalize and generalize Bowen’s theorem. In the process we propose a new idea of a public goods allocation system, a “pseudo-Lindahl equilibrium”. Though it is Pareto efficient for an interesting class of societies, the informational requirements for implementing pseudo-Lindahl equilibrium are considerably less stringent than those for a true Lindahl equilibrium.

Suggested Citation

  • Ted C. Bergstrom, 1981. "When Does Majority Rule Supply Public Goods Efficiently?," Palgrave Macmillan Books, in: Steinar Strøm (ed.), Measurement in Public Choice, pages 75-85, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-1-349-05090-1_6
    DOI: 10.1007/978-1-349-05090-1_6
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    Cited by:

    1. Nikhil Garg & Ashish Goel & Benjamin Plaut, 2021. "Markets for public decision-making," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 56(4), pages 755-801, May.

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