“Almost” Subsidy-free Spatial Pricing in a Multi-dimensional Setting

Arbeitspapier

Consider a population of citizens uniformly spread over the entire plane, that faces a problem of locating public facilities to be used by its members. The cost of every facility is financed by its users, who also face an idiosyncratic private access cost to the facility. We assume that the facilities’ cost is independent of location and access costs are linear with respect to the Euclidean distance. We show that an external intervention that covers 0.19% of the facility cost is sufficient to guarantee secession-proofness or no cross-subsidization, where no group of individuals is charged more than its stand alone cost incurred if it had acted on its own. Moreover, we demonstrate that in this case the Rawlsian access pricing is the only secession-proof allocation.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Nota di Lavoro ; No. 68.2007

Classification and Topics

• Classification: Wirtschaft ; Analysis of Collective Decision-Making: General ; Taxation, Subsidies, and Revenue: General ; State and Local Government; Intergovernmental Relations: Interjurisdictional Differentials and Their Effects
• Subject: Secession-Proofness ; Optimal Jurisdictions ; Rawlsian Allocation ; Hexagonal Partition ; Cross-Subsidization ; Öffentliche Einrichtung ; Standortwahl ; Allokation ; Rawls-Gerechtigkeitstheorie ; Entscheidungstheorie ; Theorie

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Savvateev, Alexei ; Drèze, Jacques ; Le Breton, Michel ; Weber, Shlomo
• Event: Veröffentlichung
• (who): Fondazione Eni Enrico Mattei (FEEM)
• (where): Milano
• (when): 2007

Further information

• Handle: http://hdl.handle.net/10419/74235
• Last update: 10.03.2025, 11:43 AM CET