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Title:Excludable and non-excludable public inputs : consequences for economic growth PDF Logo
Authors:Ott, Ingrid
Turnovsky, Stephen J.
Issue Date:2005
Series/Report no.:CESifo working papers 1423
Abstract:Many public goods are characterized by rivalry and/or excludability. This paper introduces both non-excludable and excludable public inputs into a simple endogenous growth model. We derive the equilibrium growth rate and design the optimal tax and user-cost structure. Our results emphasize the role of congestion in determining this optimal financing structure and the consequences this has in turn for the government?s budget. The latter consists of fee and tax revenues that are used to finance the entire public production input and that may or may not suffice to finance the entire public input, depending upon the degree of congestion. We extend the model to allow for monopoly pricing of the user fee by the government. Most of the analysis is conducted for general production functions consistent with endogenous growth, although the case of CES technology is also considered.
Subjects:excludable and non-excludable public goods
congestion
growth
JEL:H40
H21
O40
Document Type:Working Paper
Appears in Collections:CESifo Working Papers, CESifo Group Munich

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