EconStor >
ifo Institut – Leibniz-Institut für Wirtschaftsforschung an der Universität München >
CESifo Working Papers, CESifo Group Munich >

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10419/38998
  
Title:Equity as a prerequisite for stable cooperation in a public-good economy: The core revisited PDF Logo
Authors:Buchholz, Wolfgang
Peters, Wolfgang
Issue Date:2010
Series/Report no.:CESifo working paper Public Finance 3113
Abstract:In this paper we explore the relationship between an equitable distribution of the cost shares in public-good provision on the one hand and the core property of an allocation on the other. In particular we show that it is an inhomogeneous distribution of cost shares that motivates some coalition of agents to separate and to block an initially given Pareto optimal allocation which can be interpreted as the outcome of a negotiation process when all agents form a grand coalition. Distributional equity of the individual burdens of public-good contribution is assessed by a specific sacrifice measure (the 'Moulin sacrifice') which is derived from the egalitarian-equivalent concept suggested by Moulin (1987). We also develop a simple core test by which it can be checked whether a given allocation is in the core thus being a possible outcome of a cooperative agreement in the public-good economy.
Subjects:public goods
core
equity
stability of cooperation
JEL:C71
D63
H41
Document Type:Working Paper
Appears in Collections:CESifo Working Papers, CESifo Group Munich

Files in This Item:
File Description SizeFormat
631011439.pdf392.62 kBAdobe PDF
No. of Downloads: Counter Stats
Download bibliographical data as: BibTeX
Share on:http://hdl.handle.net/10419/38998

Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.