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Axiomatic foundation for Lindahl pricing in the NIMBY context

Author

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  • Laurent-Lucchetti, Jérémy
  • Leroux, Justin

Abstract

The siting of public facilities, such as prisons, airports or incinerators for hazardous waste typically faces social rejection by local populations (the "NIMBY" syndrome, for Not In My BackYard). These public goods exhibit a private bad aspect which creates an asymmetry: all involved communities benet from their existence, but only one (the host community) bears the local negative externality. We view the siting problem as a cost sharing issue and provide an axiomatic foundation for Lindahl pricing in this context. The set of axioms we introduce are specically designed to overcome the asymmetry of the problem.

Suggested Citation

  • Laurent-Lucchetti, Jérémy & Leroux, Justin, 2009. "Axiomatic foundation for Lindahl pricing in the NIMBY context," MPRA Paper 14930, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:14930
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    File URL: https://mpra.ub.uni-muenchen.de/14930/1/MPRA_paper_14930.pdf
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    References listed on IDEAS

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    1. David Pérez-Castrillo & David Wettstein, 2002. "Choosing Wisely: A Multibidding Approach," American Economic Review, American Economic Association, vol. 92(5), pages 1577-1587, December.
    2. Herve Moulin, 2004. "Fair Division and Collective Welfare," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262633116, January.
    3. Marchetti Nicolas & Serra Daniel, 2003. "A cooperative game for siting noxious facilities: theory and experimental design," Economics Bulletin, AccessEcon, vol. 3(22), pages 1-8.
    4. Vajjhala, Shalini P. & Fischbeck, Paul S., 2007. "Quantifying siting difficulty: A case study of US transmission line siting," Energy Policy, Elsevier, vol. 35(1), pages 650-671, January.
    5. O'Sullivan Arthur, 1993. "Voluntary Auctions for Noxious Facilities: Incentives to Participate and the Efficiency of Siting Decisions," Journal of Environmental Economics and Management, Elsevier, vol. 25(1), pages 12-26, July.
    6. Laurent-Lucchetti, Jérémy & Leroux, Justin, 2011. "Choosing and sharing," Games and Economic Behavior, Elsevier, vol. 73(1), pages 296-300, September.
    7. repec:ebl:ecbull:v:3:y:2003:i:22:p:1-8 is not listed on IDEAS
    8. Baumol,William J. & Oates,Wallace E., 1988. "The Theory of Environmental Policy," Cambridge Books, Cambridge University Press, number 9780521322249, November.
    9. Toyotaka Sakai, 2012. "Fair waste pricing: an axiomatic analysis to the NIMBY problem," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 50(2), pages 499-521, June.
    10. Minehart, Deborah & Neeman, Zvika, 2002. "Effective Siting of Waste Treatment Facilities," Journal of Environmental Economics and Management, Elsevier, vol. 43(2), pages 303-324, March.
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    Cited by:

    1. Laurent-Lucchetti, Jérémy & Leroux, Justin, 2011. "Choosing and sharing," Games and Economic Behavior, Elsevier, vol. 73(1), pages 296-300, September.

    More about this item

    Keywords

    Public goods; Externalities; NIMBY; Location; Cost sharing;

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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