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On the Private Provision of Public Goods: A Diagrammatic Exposition

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  • Eduardo Ley

    (IMF)

Abstract

This paper surveys a selection of the literature on the private provision of public goods using the Kolm triangle. (The Kolm triangle is the analogue of an Edgeworth box in an economy with a public good.) We provide simple geometrical proofs of various established results using this graphical device. Our reference framework is the model of private contributions to public goods developed by Bergstrom, Blume and Varian (1986). With the Kolm triangle, we can easily study the existence and uniqueness of Nash equilibria, the effects of redistribution of the initial wealth, the level of provision in Stackelberg equilibria, the effects of subsidizing private contributions, and the implementation of Lindahl equilibria.

Suggested Citation

  • Eduardo Ley, 1995. "On the Private Provision of Public Goods: A Diagrammatic Exposition," Public Economics 9503001, University Library of Munich, Germany, revised 29 Dec 2002.
    • Handle: RePEc:wpa:wuwppe:9503001
    Note: Section 5.2 on welfare-enhancing regressive redistributions was added in December 2002.
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    References listed on IDEAS

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    Cited by:

    1. Itaya, Jun-ichi & de Meza, David & Myles, Gareth D., 1997. "In praise of inequality: public good provision and income distribution," Economics Letters, Elsevier, vol. 57(3), pages 289-296, December.
    2. Wolfgang Buchholz & Richard Cornes & Dirk Rübbelke, 2020. "Matching in the Kolm triangle: interiority and participation constraints of matching equilibria," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 47(5), pages 1039-1050, April.
    3. Lechene, Valérie & Preston, Ian, 2011. "Noncooperative household demand," Journal of Economic Theory, Elsevier, vol. 146(2), pages 504-527, March.
    4. Eduardo Ley., "undated". "Public-good productivity differentials and non-cooperative public-good provision," Working Papers 97-02, FEDEA.
    5. Shrestha, Ram K. & Alavalapati, Janaki R. R., 2004. "Valuing environmental benefits of silvopasture practice: a case study of the Lake Okeechobee watershed in Florida," Ecological Economics, Elsevier, vol. 49(3), pages 349-359, July.
    6. David P. Myatt & Chris Wallace, 2005. "The Evolution of Teams," Palgrave Macmillan Books, in: Natalie Gold (ed.), Teamwork, chapter 4, pages 78-101, Palgrave Macmillan.
    7. Valerie Lechene & Ian Preston & University College London and Institute for Fiscal Studies, 2005. "Household Nash Equilibrium with Voluntarily Contributed Public Goods," Economics Series Working Papers 226, University of Oxford, Department of Economics.
    8. David P. Myatt & Chris Wallace, 2002. "Equilibrium Selection and Public Good Provision," Economics Series Working Papers 103, University of Oxford, Department of Economics.
    9. Valérie Lechene & Ian Preston, 2007. "Demand properties in household Nash equilibrium," IFS Working Papers W07/01, Institute for Fiscal Studies.
    10. Carmen Marcuello & Vicente Salas, 2001. "Nonprofit Organizations, Monopolistic Competition, and Private Donations: Evidence from Spain," Public Finance Review, , vol. 29(3), pages 183-207, May.
    11. Carmen Marcuello & Vicente Salas, 2000. "Money and time donations to Spanish Non Governmental Organizations for development aid," Investigaciones Economicas, Fundación SEPI, vol. 24(1), pages 51-73, January.
    12. Göran Bostedt, 1999. "Threatened Species as Public Goods and Public Bads," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 13(1), pages 59-73, January.

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    More about this item

    Keywords

    Public Goods; Nash Equilibrium; Stackelberg Equilibrium; Lindahl Equilibrium; Kolm triangle; Redistribution; Subsidies; Regressive Redistribution of Income;
    All these keywords.

    JEL classification:

    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General

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