Democracy, redistributive taxation and the private provision of public goods

Thomas Markussen

doi:10.1016/j.ejpoleco.2010.06.002

Democracy, redistributive taxation and the private provision of public goods

3 Citations (Scopus)

Abstract

The paper studies in a simple, Downsian model of political competition the private provision of public goods embedded in a system of democracy and redistributive taxation. Results show that the positive effect of inequality on production of public goods, to which Olson (1965) pointed, is weakened and might even be reversed in this context. Also, the median voter may choose a negative tax rate, even if he or she is poorer than the mean, in order to stimulate production of public goods. The relevance of the model is illustrated with an application to the financing of higher education.

Original language	English
Journal	European Journal of Political Economy
Volume	27
Issue number	1
Pages (from-to)	201-213
Number of pages	13
ISSN	0176-2680
DOIs	https://doi.org/10.1016/j.ejpoleco.2010.06.002
Publication status	Published - Mar 2011

Keywords

Faculty of Social Sciences

Access to Document

10.1016/j.ejpoleco.2010.06.002

Cite this

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abstract = "The paper studies in a simple, Downsian model of political competition the private provision of public goods embedded in a system of democracy and redistributive taxation. Results show that the positive effect of inequality on production of public goods, to which Olson (1965) pointed, is weakened and might even be reversed in this context. Also, the median voter may choose a negative tax rate, even if he or she is poorer than the mean, in order to stimulate production of public goods. The relevance of the model is illustrated with an application to the financing of higher education.",

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N2 - The paper studies in a simple, Downsian model of political competition the private provision of public goods embedded in a system of democracy and redistributive taxation. Results show that the positive effect of inequality on production of public goods, to which Olson (1965) pointed, is weakened and might even be reversed in this context. Also, the median voter may choose a negative tax rate, even if he or she is poorer than the mean, in order to stimulate production of public goods. The relevance of the model is illustrated with an application to the financing of higher education.

AB - The paper studies in a simple, Downsian model of political competition the private provision of public goods embedded in a system of democracy and redistributive taxation. Results show that the positive effect of inequality on production of public goods, to which Olson (1965) pointed, is weakened and might even be reversed in this context. Also, the median voter may choose a negative tax rate, even if he or she is poorer than the mean, in order to stimulate production of public goods. The relevance of the model is illustrated with an application to the financing of higher education.

KW - Faculty of Social Sciences

KW - public goods

KW - political economy

KW - inequality

KW - taxation

KW - higher education

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