Democracy, Redistributive Taxation and the Private Provision of Public Goods
Publikation: Working paper › Forskning
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Democracy, Redistributive Taxation and the Private Provision of Public Goods. / Markussen, Thomas.
Department of Economics, University of Copenhagen, 2010.Publikation: Working paper › Forskning
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TY - UNPB
T1 - Democracy, Redistributive Taxation and the Private Provision of Public Goods
AU - Markussen, Thomas
N1 - JEL Classification: D31, D7, H2, H41, I22
PY - 2010
Y1 - 2010
N2 - The paper studies in a simple, Downsian model of political competition how the private provision of public goods is affected when it is embedded in a system of democracy and redistributive taxation. Results show that the positive effect of inequality on public goods production, which Olson (1965) pointed to, is weakened and might even be reversed in this context. Also, the median voter may choose a negative tax rate, even if he is poorer than the mean, in order to stimulate public goods production. The relevance of the model is illustrated with an application to the finance of higher education.
AB - The paper studies in a simple, Downsian model of political competition how the private provision of public goods is affected when it is embedded in a system of democracy and redistributive taxation. Results show that the positive effect of inequality on public goods production, which Olson (1965) pointed to, is weakened and might even be reversed in this context. Also, the median voter may choose a negative tax rate, even if he is poorer than the mean, in order to stimulate public goods production. The relevance of the model is illustrated with an application to the finance of higher education.
KW - Faculty of Social Sciences
KW - politisk økonomi
KW - political economy
KW - inequality, taxation
KW - higher education
M3 - Working paper
BT - Democracy, Redistributive Taxation and the Private Provision of Public Goods
PB - Department of Economics, University of Copenhagen
ER -
ID: 18585973