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Buchanan-Kooperation und Internationale Oeffentliche Gueter

Listed author(s):
  • Rundshagen, Bianca


    (The FernUniversitaet / University of Hagen)

  • Zimmermann, Klaus W.


    (Helmut Schmidt University, Hamburg)

In this contribution, James Buchanan's model of the voluntary provision of public goods is formalized and applied to the case of a rich and poor actor which also can be inter-preted as industrialized and developing countries in the debate on global environmental goods. Concerning the utility functions of these actors, two scenarios are being analyzed: Whereas in the neutrality-case the marginal gross utility of the public good is strictly positive for both actors, an excessive production of it leads to undesired consequences in the repercussion-case implying that the marginal gross utility of one actor becomes negative as soon as his/her saturation level is trespassed. It is assumed that the consumer of the good is able to influence the quantity of the good supplied by transfer payments leading to two kinds of co-operation: a positive co-operation to increase the quantity and a negative co-operation to reduce it. It can be shown for a given assignment of the roles as producer and consumer that in both cases there will always be a socially optimal level of production implying that there isn't any collective-good-problem as far as decisions are rational and not influenced by emotions like envy or malevolence. However, there is always a conflict of interests regarding the assignment of roles: in the repercussion-case both actors prefer being a producer as soon as the marginal costs become sufficiently low and vice versa, in the neutrality-case both actors strive for the consumer role independent from the level of the marginal costs. Since in the Buchanan-model only the consumer realizes the gains from co-operation, we have to ask how a burden-sharing arrangement should look like which can be considered as just. Here, two alternative financing rules are proposed: in the first alternative, the financing share of an actor or country is determined by the specific part of the total consumer rents it enjoys whereas in the second alterna-tive, known as Lindahl-pricing, the share of the costs corresponds to the relative marginal utility. It is shown for both variants that with decreasing marginal costs of production there should be a reallocation of the burden towards the rich actor or country. Finally, the introduction of distributional constraints into the allocative decisions leads to a decisive worsening in the supply of the public good.

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Paper provided by Helmut Schmidt University, Hamburg in its series Working Paper with number 87/2009.

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Length: 38 pages
Date of creation: 06 Jan 2009
Handle: RePEc:ris:vhsuwp:2009_087
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