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Country Size and Public Good Provision

Author

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  • Klaas Staal

    () (Faculty of Economics, Erasmus Universiteit Rotterdam)

Abstract

This paper studies the equilibrium size of countries. Individuals in smallcountries have greater influence over the nature of political decision mak-ing while individuals in large countries have the advantage of more publicgoods and lower tax rates. The model implies that (i) there exists excessiveincentives to separate, though this need not be the case for all sets of seces-sion rules studied; (ii) an exogenous increase in public spending decreasescountry size; (iii) countries with a presidential-congressional democracy arelarger than countries with a parliamentary democracy.

Suggested Citation

  • Klaas Staal, 2004. "Country Size and Public Good Provision," Tinbergen Institute Discussion Papers 04-026/1, Tinbergen Institute.
  • Handle: RePEc:tin:wpaper:20040026
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    References listed on IDEAS

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    14. Besley, Timothy & Coate, Stephen, 2003. "Centralized versus decentralized provision of local public goods: a political economy approach," Journal of Public Economics, Elsevier, vol. 87(12), pages 2611-2637, December.
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    More about this item

    Keywords

    country size; public spending; structure of government;

    JEL classification:

    • D7 - Microeconomics - - Analysis of Collective Decision-Making
    • H1 - Public Economics - - Structure and Scope of Government
    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • H7 - Public Economics - - State and Local Government; Intergovernmental Relations

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