Vertical Externalities Revisited: New Results with Public Inputs and Unit Taxation
| Autor: | Diego Martinez |
|---|---|
| Rok vydání: | 2018 |
| Předmět: |
Economics and Econometrics
Government business.industry media_common.quotation_subject Public sector Outcome (game theory) Unit (housing) Microeconomics jel:H2 Fiscal federalism vertical externality productive public spending jel:H4 Economics Stackelberg competition jel:H7 Federalism business Function (engineering) Finance Externality media_common |
| Zdroj: | Revista Hacienda Pública Española. 225:11-30 |
| ISSN: | 0210-1173 |
| DOI: | 10.7866/hpe-rpe.18.2.1 |
| Popis: | This paper studies the provision of public inputs in a federal system with unit taxation on labor. We use a model with vertical tax and expenditure externalities to analyze the e¢ ciency of equilibria under di¤erent settings, particularly Nash and Stackelberg equilibria. Our results discuss some ?ndings from the previous literature. First, both vertical externalities are interrelated each other. Second, the condition for production e¢ ciency in the public sector becomes irrelevant to assess optimality. And third, the replication of the second-best outcome by the federal government behaving as Stackelberg leader crucially depends on the states?reaction function. |
| Databáze: | OpenAIRE |
| Externí odkaz: |
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