Public Goods and Optimal Paternalism under Present-Biased Preferences
This paper deals with the optimal provision of a state-variable public good in a two-type model, when the consumers have present-biased preferences due to quasi-hyperbolic discounting. The results show that the preference for immediate gratification facing the (mimicking) high-ability type weakens the incentive to adjust the public provision in response to the self-selection constraint.
|Date of creation:||01 Jun 2010|
|Date of revision:|
|Note:||Public Goods; Quasi-Hyperbolic Discounting; Redistribution; Asymmetric Information|
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"Doing It Now or Later,"
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Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 51(4), pages 1071-1095, November.
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784828000000000346, UCLA Department of Economics.
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- Aronsson, Thomas & Thunström, Linda, 2008. "A note on optimal paternalism and health capital subsidies," Economics Letters, Elsevier, vol. 101(3), pages 241-242, December.
- W. Viscusi & Joel Huber & Jason Bell, 2008. "Estimating discount rates for environmental quality from utility-based choice experiments," Journal of Risk and Uncertainty, Springer, vol. 37(2), pages 199-220, December.
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