|
EconStor >
Zentrum für Europäische Wirtschaftsforschung (ZEW), Mannheim >
ZEW Discussion Papers >
Please use this identifier to cite or link to this item:
http://hdl.handle.net/10419/24726
|
| | |
| Title: | | Conditional Grants, Grant-Seeking and Welfare when there is Government Failure on the Subordinate Level  |
| Authors: | | Bischoff, Ivo |
| Issue Date: | | 2008 |
| Series/Report no.: | | ZEW Discussion Papers 08-031 |
| Abstract: | | The paper addresses the welfare implications of conditional grants if government failure leads to inefficiencies in the production of regional public goods and services. Conditional grants may improve welfare by setting incentives for regions to improve efficiency. At the same time, resources are wasted in the process of grant-seeking. This paper provides a theoretical model to assess the net effect on welfare. A three-stage game-theoretic context is developed and simulations are performed to derive the optimal grant-distribution scheme. We found conditional grants to be welfare-enhancing in the vast majority of simulated scenarios under a classical utilitarian welfare function. Once distributional concerns are accounted for, the scope for conditional grants becomes limited. |
| Subjects: | | conditional grants government failure rent-seeking normative public finance |
| JEL: | | H77 H5 H11 D7 |
| Document Type: | | Working Paper |
| Appears in Collections: | | Publikationen von Forscherinnen und Forschern des ZEW ZEW Discussion Papers
|
| |
| | |
Download bibliographical data as:
BibTeX
|
| |
Share on:http://hdl.handle.net/10419/24726
|
Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.
|