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A Note on the Efficiency of Income Redistribution with Simple and Combined Policies

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  • Bullock, David S.
  • Salhofer, Klaus

Abstract

Recent studies have investigated the efficiencies of policies that use several policy instruments simultaneously (for example, a policy that uses a production subsidy combined with a production quota). Several studies of very specific cases find that optimal combination of two policy instruments is more efficient than optimal independent use of either. In this note we demonstrate using set theory and maximization theory, that all such specific results are examples of a more general result, which is that by combining m instruments efficiently, a government can always be at least as efficient as when using a subset of those m instruments. This result holds for any of the several definitions of “efficiency” in the literature.

Suggested Citation

  • Bullock, David S. & Salhofer, Klaus, 1998. "A Note on the Efficiency of Income Redistribution with Simple and Combined Policies," Agricultural and Resource Economics Review, Cambridge University Press, vol. 27(2), pages 266-269, October.
    • Handle: RePEc:cup:agrerw:v:27:y:1998:i:02:p:266-269_00
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    1. Julian M. Alston & Brian H. Hurd, 1990. "Some Neglected Social Costs of Government Spending in Farm Programs," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 72(1), pages 149-156.
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    4. Harry de Gorter & David J. Nielson & Gordon C. Rausser, 1992. "Productive and Predatory Public Policies: Research Expenditures and Producer Subsidies in Agriculture," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 74(1), pages 27-37.
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    1. Bullock David S. & Couleau Anabelle, 2014. "Policy Analysis in Welfare and Policy Spaces: Applications to the Labyrinthine U.S. Ethanol Policy Literature," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 12(1), pages 35-51, January.
    2. Bullock, David S. & Salhofer, Klaus, 2003. "Judging agricultural policies: a survey," Agricultural Economics, Blackwell, vol. 28(3), pages 225-243, May.
    3. Alston, Julian M. & Smith, Vincent H. & Acquaye, Albert & Hosseini, Safdar, 1999. "Least-cost cheap-food policies: some implications of international food aid," Agricultural Economics, Blackwell, vol. 20(3), pages 191-201, May.
    4. David S. Bullock & Klaus Salhofer & Jukka Kola, 1999. "The Normative Analysis of Agricultural Policy: A General Framework and Review," Journal of Agricultural Economics, Wiley Blackwell, vol. 50(3), pages 512-535, September.

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