Public Goods Theories and Evidence

This book is a broad survey of the literature on public goods. There has been an explosion of research in the last ten years in a broad variety of - eas in this literature and the time seems right for a survey of this work. This includes the recent work o

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Raymond G. Batina Toshihiro Ihori

Public Goods Theories and Evidence

With 13 Figures and 10 Tables

123

Professor Raymond G. Batina Department of Economics Washington State University Pullman, WA 99164-4741 USA E-mail: [email protected] Professor Toshihiro Ihori Department of Economics University of Tokyo 7-3-1 Hongo, Bunkyo-ku Tokyo, 113-0033 Japan E-mail: [email protected]

Cataloging-in-Publication Data Library of Congress Control Number: 2005925028

ISBN 3-540-24174-4 Springer Berlin Heidelberg New York This work is subject to copyright. All rights are reserved, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilm or in any other way, and storage in data banks. Duplication of this publication or parts thereof is permitted only under the provisions of the German Copyright Law of September 9, 1965, in its current version, and permission for use must always be obtained from Springer-Verlag. Violations are liable for prosecution under the German Copyright Law. Springer is a part of Springer Science+Business Media springeronline.com © Springer-Verlag Berlin Heidelberg 2005 Printed in Germany The use of general descriptive names, registered names, trademarks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. Cover design: Erich Kirchner Production: Helmut Petri Printing: Strauss Offsetdruck SPIN 11370956

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Preface

This book is a broad survey of the literature on public goods. There has been an explosion of research in the last ten years in a broad variety of areas in this literature and the time seems right for a survey of this work. This includes the recent work on dynamic theories of public goods, second-best financing methods, surveys and contingent valuation in determining the willingness-to-pay (WTP) for public goods, voting models, privately produced public goods, charity and national radio, experiments on public goods, public inputs, public capital and infrastructure, the Tiebout sorting mechanism, local public goods (LPGs), club goods, and fiscal competition and coordination. We survey developments in the theory and the empirical work in each area. We also present the classic results to place the new developments in context. This book is appropriate for advanced undergraduates, graduate students who wish to learn the latest research in this area, and for practitioners who want to broaden their knowledge outside their own area of expertise. We present the background for each result and try to give the reader a feel for how a particular area of the literature developed. The technical results are provided and an intuitive explanation for them is also given. We also present some new results in many of the chapters as well. Each chapter is reasonably self-contained. A variety of