The efficient provision of public goods through non-distortionary tax contests
We use a simple balanced budget contest to collect taxes on a private good in order to ?nance a pure public good. We show that-with an appropriately chosen structure of winning probabilities-this contest can provide the public good efficiently and without distorting private consumption. We provide extensions to multiple public goods and private taxation sources, asymmetric preferences, and show the mechanismâ€™s robustness across these settings.
|Date of creation:||Mar 2011|
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