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Democracy, redistributive taxation and the private provision of public goods

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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.
OriginalsprogEngelsk
TidsskriftEuropean Journal of Political Economy
Vol/bind27
Udgave nummer1
Sider (fra-til)201-213
Antal sider13
ISSN0176-2680
DOI
StatusUdgivet - mar. 2011

Bibliografisk note

JEL classification: D31, D7, H2, H41, I22

ID: 33599390