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.
|Date of creation:||01 Jan 2010|
|Date of revision:|
|Contact details of provider:|| Postal: Durham University Business School, Mill Hill Lane, Durham DH1 3LB, England|
Phone: +44 (0)191 334 5200
Fax: +44 (0)191 334 5201
Web page: http://www.dur.ac.uk/business
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Itaya, Jun-ichi & Shimomura, Koji, 2001.
"A dynamic conjectural variations model in the private provision of public goods: a differential game approach,"
Journal of Public Economics,
Elsevier, vol. 81(1), pages 153-172, July.
- 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.
- Fershtman, Chaim & Nitzan, Shmuel, 1991.
"Dynamic voluntary provision of public goods,"
European Economic Review,
Elsevier, vol. 35(5), pages 1057-1067, July.
- Cornes,Richard & Sandler,Todd, 1996. "The Theory of Externalities, Public Goods, and Club Goods," Cambridge Books, Cambridge University Press, number 9780521477185, November.
- Gerhard Glomm & Roger Lagunoff, 1999. "A Dynamic Tiebout Theory of Voluntary vs. Involuntary Provision of Public Goods," Review of Economic Studies, Oxford University Press, vol. 66(3), pages 659-677.
- Bergstrom, Theodore & Blume, Lawrence & Varian, Hal, 1986. "On the private provision of public goods," Journal of Public Economics, Elsevier, vol. 29(1), pages 25-49, February.
- Andreoni, James, 1988. "Privately provided public goods in a large economy: The limits of altruism," Journal of Public Economics, Elsevier, vol. 35(1), pages 57-73, February.
When requesting a correction, please mention this item's handle: RePEc:dur:durham:2010_02. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (IT Office)
If references are entirely missing, you can add them using this form.