Should the Government Finance Public Goods in Rural Areas? A Review of Arguments
This paper reviews three arguments why government should not directly finance public goods provision in the countryside: (1) sorting and voting of residents leads to efficient local public goods provision, (2) community governance better copes with incomplete contracting in public goods, and (3) public provision drives out voluntary private provi-sion of public goods. Theory and empirical evidence partly support these arguments. The adequate level of rural governance appears to be often below the national or Euro-pean level, and policy should focus on the institutional premises of public goods provi-sion rather than on centralized payments to public good providers.
|Date of creation:||Apr 2006|
|Date of revision:|
|Contact details of provider:|| Postal: |
Web page: http://www.aae.wisc.edu/pubs/sps/
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.:
- Paul W. Rhode & Koleman S. Strumpf, 2003. "Assessing the Importance of Tiebout Sorting: Local Heterogeneity from 1850 to 1990," American Economic Review, American Economic Association, vol. 93(5), pages 1648-1677, December.
- Robert D. Weaver, 1996. "Prosocial Behavior: Private Contributions to Agriculture's Impact on the Environment," Land Economics, University of Wisconsin Press, vol. 72(2), pages 231-247.
- Baland, Jean-Marie & Platteau, Jean-Philippe, 2000. "Halting Degradation of Natural Resources: Is There a Role for Rural Communities?," OUP Catalogue, Oxford University Press, number 9780198290612, March.
- Charles M. Tiebout, 1956. "A Pure Theory of Local Expenditures," Journal of Political Economy, University of Chicago Press, vol. 64, pages 416.
- Diamond, Peter, 2006. "Optimal tax treatment of private contributions for public goods with and without warm glow preferences," Journal of Public Economics, Elsevier, vol. 90(4-5), pages 897-919, May.
- Cornes,Richard & Sandler,Todd, 1996. "The Theory of Externalities, Public Goods, and Club Goods," Cambridge Books, Cambridge University Press, number 9780521477185, May.
- Frey, Bruno S, 1997. "A Constitution for Knaves Crowds Out Civic Virtues," Economic Journal, Royal Economic Society, vol. 107(443), pages 1043-53, July.
- Ross, Stephen & Yinger, John, 1999. "Sorting and voting: A review of the literature on urban public finance," Handbook of Regional and Urban Economics, in: P. C. Cheshire & E. S. Mills (ed.), Handbook of Regional and Urban Economics, edition 1, volume 3, chapter 47, pages 2001-2060 Elsevier.
- James Andreoni & A. Abigail Payne, 2003. "Do Government Grants to Private Charities Crowd Out Giving or Fund-raising?," American Economic Review, American Economic Association, vol. 93(3), pages 792-812, June.
- Theesfeld, Insa, 2004. "Constraints on Collective Action in a Transitional Economy: The Case of Bulgaria's Irrigation Sector," World Development, Elsevier, vol. 32(2), pages 251-271, February.
- Steven C. Deller & Tsung-Hsiu (Sue) Tsai & David W. Marcouiller & Donald B.K. English, 2001. "The Role of Amenities and Quality of Life In Rural Economic Growth," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 83(2), pages 352-365.
- Lewis, David A. & Hunt, Gary L. & Plantinga, Andrew J., 2001.
"Public Conservation Land And Employment Growth In The Northern Forest Region,"
2001 Annual meeting, August 5-8, Chicago, IL
20748, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
- David J. Lewis & Gary L. Hunt & DAndrew J. Plantinga, 2002. "Public Conservation Land and Employment Growth in the Northern Forest Region," Land Economics, University of Wisconsin Press, vol. 78(2), pages 245-259.
- Payne, A. Abigail, 1998. "Does the government crowd-out private donations? New evidence from a sample of non-profit firms," Journal of Public Economics, Elsevier, vol. 69(3), pages 323-345, September.
When requesting a correction, please mention this item's handle: RePEc:ecl:wisagr:497. 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: ()
If references are entirely missing, you can add them using this form.