A utilitarian approach to the provision and pricing of excludable public goods

Hellwig, Martin

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URL:	https://ub-madoc.bib.uni-mannheim.de/2747
URN:	urn:nbn:de:bsz:180-madoc-27473
Document Type:	Working paper
Year of publication:	2003
The title of a journal, publication series:	Rationalitätskonzepte, Entscheidungsverhalten und ökonomische Modellierung
Volume:	03-36
Place of publication:	Mannheim
Publication language:	English
Institution:	School of Law and Economics > Sonstige - Fakultät für Rechtswissenschaft und Volkswirtschaftslehre
MADOC publication series:	Sonderforschungsbereich 504 > Rationalitätskonzepte, Entscheidungsverhalten und ökonomische Modellierung (Laufzeit 1997 - 2008)
Subject:	330 Economics
Classification:	JEL: H41 H21 D63 D61 ,
Subject headings (SWD):	Öffentliches Gut , Gebühr , Wohlfahrtsfunktion , Utilitarismus , Theorie
Keywords (English):	Public-good provision , entry fees for excludable public goods , utilitarian welfare maximization
Abstract:	The paper studies utilitarian welfare maximization in a model with an excludable public good where individual preferences are private information. If inequality aversion is large, optimal allocations involve the use of admission fees and exclusion to redistribute resources from people who benefit a lot from the public good to people who benefit little. If inequality aversion is close to zero, optimal admission fees are zero. These results are robust if earning abilities provide an additional source of heterogeneity and income taxation an additional policy instrument.
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