Arbeitspapier
Local public good provision, municipal consolidation, and national transfers
We analyze a simple model of local public good provision in a region comprising two districts, a city and a village. When districts remain autonomous and local public goods have positive spillover effects on the neighboring district, there is underprovision of public goods in both the city and the village. When districts consolidate, underprovision persists in the village (and may become even more severe), whereas overprovision of public goods arises in the city as urbanites use their political power to exploit the villagers. From a social welfare point of view, inhabitants of the village have insufficient incentives to vote for consolidation. We examine how national transfers to local governments can resolve these problems.
- Language
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Englisch
- Bibliographic citation
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Series: CESifo Working Paper ; No. 2061
- Classification
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Wirtschaft
- Subject
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Lokales öffentliches Gut
Stadt-Land-Beziehung
Spillover-Effekt
Gebietsreform
Wahlverhalten
Finanzausgleich
Wohlfahrtseffekt
Theorie
- Event
-
Geistige Schöpfung
- (who)
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Dur, Robert
Staal, Klaas
- Event
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Veröffentlichung
- (who)
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Center for Economic Studies and ifo Institute (CESifo)
- (where)
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Munich
- (when)
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2007
- Handle
- Last update
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10.03.2025, 11:43 AM CET
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Dur, Robert
- Staal, Klaas
- Center for Economic Studies and ifo Institute (CESifo)
Time of origin
- 2007
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