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Public goods and public bads

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  • Wolfgang Buchholz
  • Richard Cornes
  • Dirk Rübbelke

Abstract

In many empirically relevant situations agents in different groups are affected by the provision of a public characteristic in divergent ways. Whereas for one group it represents a public good, it is a public bad for another group. Applying Cornes and Hartley's aggregative game approach, we analyze a general model in which such contentious public characteristics are present and are provided cooperatively. In particular, we establish neutrality results with respect to redistribution and growth of income, infer the effects of preference changes and coalition formation, and present a technology paradox. Finally, we compare the outcome of voluntary provision of the contentious public characteristic with the Pareto‐optimal solution, highlighting a potential conflict between equity and efficiency in this case.

Suggested Citation

  • Wolfgang Buchholz & Richard Cornes & Dirk Rübbelke, 2018. "Public goods and public bads," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 20(4), pages 525-540, August.
    • Handle: RePEc:bla:jpbect:v:20:y:2018:i:4:p:525-540
    DOI: 10.1111/jpet.12298
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    References listed on IDEAS

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    1. Warr, Peter G., 1983. "The private provision of a public good is independent of the distribution of income," Economics Letters, Elsevier, vol. 13(2-3), pages 207-211.
    2. Toshihiro Ihori, 2000. "Defense Expenditures and Allied Cooperation," CIRJE F-Series CIRJE-F-68, CIRJE, Faculty of Economics, University of Tokyo.
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    Cited by:

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    2. Dripto Bakshi & Indraneel Dasgupta, 2021. "A Subscription vs. Appropriation Framework for Natural Resource Conflicts," World Scientific Book Chapters, in: Anil Markandya & Dirk Rübbelke (ed.), CLIMATE AND DEVELOPMENT, chapter 9, pages 257-307, World Scientific Publishing Co. Pte. Ltd..
    3. Bedřich Moldan, 2022. "Vládnutí globálním společným statkům v éře antropocénu [Governance of Global Common Goods in the Era of Anthropocene]," Politická ekonomie, Prague University of Economics and Business, vol. 2022(4), pages 500-526.
    4. Dasgupta, Indraneel, 2024. "A Rent-Seeking Perspective on Imperial Peace," IZA Discussion Papers 17312, Institute of Labor Economics (IZA).
    5. Todd Sandler, 2018. "Collective action and geoengineering," The Review of International Organizations, Springer, vol. 13(1), pages 105-125, March.
    6. Bakshi, Dripto & Dasgupta, Indraneel, 2022. "Can extremism reduce conflict?," Economics Letters, Elsevier, vol. 215(C).
    7. Alexis Poindron & Nizar Allouch, 2024. "A Model of Competing Gangs in Networks," Games, MDPI, vol. 15(2), pages 1-15, February.

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    More about this item

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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