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Footloose capital and productive public services

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  • Pasquale Commendatore

    () (University of Naples 'Federico II', Italy)

  • Ingrid Kubin

    () (Department of Economics, Vienna University of Economics & B.A.)

  • Carmelo Petraglia

    () (University of Naples 'Federico II', Italy)

Abstract

We analyse in a Footloose Capital productive public services provided by a central government aiming at reducing regional disparities. Two countervailing effects occur – one upon productivity and another upon local demand – the relative strength of which depends upon the financing scheme. Only if the “rich” region contributes sufficiently to the financing of the public services in the “poor” region, the poor region will actually gain. In studying these questions we pay particular attention to the dynamic adjustment processes and to the role of trade freeness.

Suggested Citation

  • Pasquale Commendatore & Ingrid Kubin & Carmelo Petraglia, 2007. "Footloose capital and productive public services," Department of Economics Working Papers wuwp111, Vienna University of Economics and Business, Department of Economics.
  • Handle: RePEc:wiw:wiwwuw:wuwp111
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    Cited by:

    1. Grafeneder-Weissteiner, Theresa & Prettner, Klaus, 2010. "Agglomeration processes in aging societies," Department of Economics Working Paper Series 1620, WU Vienna University of Economics and Business.
    2. Eckhard Hein, 2010. "Shareholder Value Orientation, Distribution And Growth-Short- And Medium-Run Effects In A Kaleckian Model," Metroeconomica, Wiley Blackwell, vol. 61(2), pages 302-332, May.
    3. Hagemann, Harald, 2010. "L. Albert Hahn's Economic Theory of Bank Credit," Department of Economics Working Paper Series 2948, WU Vienna University of Economics and Business.
    4. Theresa Grafeneder-Weissteiner & Klaus Prettner, 2009. "Agglomeration and population ageing in a two region model of exogenous growth," VID Working Papers 0901, Vienna Institute of Demography (VID) of the Austrian Academy of Sciences in Vienna.
    5. Engelbert Stockhammer & Paul Ramskogler, 2009. "Post-Keynesian economics How to move forward," European Journal of Economics and Economic Policies: Intervention, Edward Elgar Publishing, vol. 6(2), pages 227-246.
    6. Engelbert Stockhammer & Lucas Grafl, 2010. "Financial Uncertainty and Business Investment," Review of Political Economy, Taylor & Francis Journals, vol. 22(4), pages 551-568.
    7. Theresa Grafeneder-Weissteiner, 2010. "Demographic change, growth and agglomeration," Department of Economics Working Papers wuwp132, Vienna University of Economics and Business, Department of Economics.
    8. Riedl, Aleksandra & Rocha-Akis, Silvia, 2007. "Testing the tax competition theory: How elastic are national tax bases in western Europe?," Department of Economics Working Paper Series 860, WU Vienna University of Economics and Business.
    9. Pasquale Commendatore & Ingrid Kubin & Carmelo Petraglia, 2009. "Footloose Capital and Productive Public Services," Chapters,in: Geography, Structural Change and Economic Development, chapter 1 Edward Elgar Publishing.
    10. Grafeneder-Weissteiner, Theresa, 2010. "Demographic change, growth and agglomeration," Department of Economics Working Paper Series 902, WU Vienna University of Economics and Business.
    11. Smet, Koen, 2007. "Stuck in the middle? The structure of trade between South Africa and its major trading partners," Department of Economics Working Paper Series 876, WU Vienna University of Economics and Business.
    12. Fellner, Gerlinde & Sutter, Matthias, 2008. "Causes, consequences, and cures of myopic loss aversion - an experimental investigation," Department of Economics Working Paper Series 244, WU Vienna University of Economics and Business.
    13. Figerl, Jürgen & Grandner, Thomas, 2008. "Job quality and wages in duopsony," Department of Economics Working Paper Series 1304, WU Vienna University of Economics and Business.

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    JEL classification:

    • H4 - Public Economics - - Publicly Provided Goods
    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation

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