Equitable Provision of Long-Term Public Goods : The Role of Negotiation Mandates
In a one-period model, whether or not individual weights in the welfare function are based on initial endowments dictate who provides public goods. But with long-term public goods, banning wealth redistribution still allows for several equilibriums...
| Main Authors: | , |
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2014
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2003/12/5278693/equitable-provision-long-term-public-goods-role-negotiation-mandates http://hdl.handle.net/10986/17431 |
| Summary: | In a one-period model, whether or not
individual weights in the welfare function are based on
initial endowments dictate who provides public goods. But
with long-term public goods, banning wealth redistribution
still allows for several equilibriums depending on
Parties' willingness to acknowledge changes in
negotiating powers over time, and on whether or not they
care only for their own descendants. Adaptative and
universal mandates lead to far more robust equilibrium. In
all cases, a simple rule of thumb for allocating
expenditures at first period emerges, independent of both
the optimal level of public goods and the second-period
distribution of expenditures. |
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