Privately provided public goods in a dynamic economy
We show that when individuals can save (accumulate capital), they all eventually become public-good contributors. In steady state, larger economies have more contributors. If the public good is normal, then its quantity increases in population size in the open-loop equilibrium, but not necessarily in the feedback equilibrium. If both private and public goods are normal, then the open-loop equilibrium exhibits greater steady-state public provision than the feedback equilibrium. If private consumption is inferior the opposite is true. Interpreting individuals as countries, our findings suggest that all countries over time will become contributors toward a global public good.
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- Jun-ichi Itaya & Koji Shimomura, 1999.
"A Dynamic Conjectural Variations Model in the Private Provision of Public Goods: a Differential Game Approach,"
Discussion Paper Series
104, Research Institute for Economics & Business Administration, Kobe University.
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- repec:cup:cbooks:9780521477185 is not listed on IDEAS
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