Equilibrium Contributions and “Locally Enjoyed” Public Goods
The main results of the traditional theory of private provision of public goods in the case of identical individuals are: 1) there exists a unique Nash equilibrium pattern of contributions in which everybody contributes the same amount (Bergstrom et al. ); 2) this pattern is locally stable (Cornes ). Under homothetic preferences, I show that these results generally no longer hold in the context of “locally enjoyed” public goods. In particular, when the symmetric Nash equilibrium is not the unique equilibrium pattern, it is locally unstable and there exists at least a locally stable asymmetric Nash equilibrium.
|Date of creation:||Nov 2004|
|Date of revision:||Nov 2004|
|Contact details of provider:|| Postal: Piazza Ateneo Nuovo, 1 Milano 20126|
Phone: +39 02 6448 3089
Fax: +39 02 6448 3085
Web page: http://dems.unimib.it
More information through EDIRC
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.:
- Glen Ellison, 2010.
"Learning, Local Interaction, and Coordination,"
Levine's Working Paper Archive
391, David K. Levine.
- Bergstrom, T.C. & Stark, O., 1993.
"How Altruism Can Prevail in an Evolutionary Environment,"
93-01, Michigan - Center for Research on Economic & Social Theory.
- Bergstrom, Theodore C & Stark, Oded, 1993. "How Altruism Can Prevail in an Evolutionary Environment," American Economic Review, American Economic Association, vol. 83(2), pages 149-55, May.
- Theodore C. Bergstrom & Oded Stark, 1994. "How Altruism Can Prevail in an Evolutionary Environment," Microeconomics 9401001, EconWPA.
- Ted Bergstrom & Oded Stark, . "How Altruism Can Prevail in an Evolutionary Environment," Papers _024, University of Michigan, Department of Economics.
- Agnar Sandmo, 1980. "Anomaly and Stability in the Theory of Externalities," The Quarterly Journal of Economics, Oxford University Press, vol. 94(4), pages 799-807.
- 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.
- Cornes, Richard, 1979. "External Effects : An Alternative Formulation," The Warwick Economics Research Paper Series (TWERPS) 159, University of Warwick, Department of Economics.
- Andreoni, James, 1990. "Impure Altruism and Donations to Public Goods: A Theory of Warm-Glow Giving?," Economic Journal, Royal Economic Society, vol. 100(401), pages 464-77, June.
- Andreoni, James, 1989. "Giving with Impure Altruism: Applications to Charity and Ricardian Equivalence," Journal of Political Economy, University of Chicago Press, vol. 97(6), pages 1447-58, December.
- 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.
- Warr, Peter G., 1983. "The private provision of a public good is independent of the distribution of income," Economics Letters, Elsevier, vol. 13(2-3), pages 207-211.
When requesting a correction, please mention this item's handle: RePEc:mib:wpaper:84. 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: (Matteo Pelagatti)
If references are entirely missing, you can add them using this form.