The Egalitarian Sharing Rule in Provision of Public Projects

18 Pages Posted: 31 Mar 2005

See all articles by Anna Bogomolnaia

Anna Bogomolnaia

Rice University

Michel Le Breton

University of Toulouse I - GREMAQ-IDEI

Alexei V. Savvateev

New Economic School (NES); New Economic School, Moscow; Moscow Institute of Physics and Technology

Shlomo Weber

Southern Methodist University (SMU) - Department of Economics; New Economic School

Date Written: March 2005

Abstract

In this note we consider a society that partitions itself into disjoint jurisdictions, each choosing a location of its public project and a taxation scheme to finance it. The set of public project is multi-dimensional, and their costs could vary from jurisdiction to jurisdiction. We impose two principles, egalitarianism, that requires the equalization of the total cost for all agents in the same jurisdiction, and efficiency, that implies the minimization of the aggregate total cost within jurisdiction. We show that these two principles always yield a core-stable partition but a Nash stable partition may fail to exist.

Keywords: Jurisdictions, Stable partitions, Public projects, Egalitarianism

JEL Classification: C71, C72, D63, H41

Suggested Citation

Bogomolnaia, Anna and Le Breton, Michel and Savvateev, Alexei Vladimirovich and Savvateev, Alexei Vladimirovich and Weber, Shlomo, The Egalitarian Sharing Rule in Provision of Public Projects (March 2005). Available at SSRN: https://ssrn.com/abstract=688364 or http://dx.doi.org/10.2139/ssrn.688364

Anna Bogomolnaia

Rice University ( email )

6100 South Main Street
Houston, TX 7705-1892
United States

Michel Le Breton

University of Toulouse I - GREMAQ-IDEI ( email )

Manufacture des Tabacs
21 Allees de Brienne
Toulouse, 31000
France

Alexei Vladimirovich Savvateev (Contact Author)

New Economic School (NES) ( email )

100A Novaya Street
Moscow, Skolkovo 143026
Russia
+7 495 129 17 00, ext 136 (Phone)
+7 495 129 37 22 (Fax)

HOME PAGE: http://www.nes.ru/~savvateev

New Economic School, Moscow ( email )

100A Novaya Street
Moscow, Skolkovo 143026
Russia
+7 495 129 17 00, ext 136 (Phone)
+7 495 129 37 22 (Fax)

HOME PAGE: http://www.nes.ru/~savvateev

Moscow Institute of Physics and Technology ( email )

Institusky lane, 9
Dolgoprudny, Moskovskaya oblast
Russia

Shlomo Weber

Southern Methodist University (SMU) - Department of Economics ( email )

Dallas, TX 75275
United States
214-768-3577 (Phone)
214-768-1821 (Fax)

New Economic School ( email )

Moscow
Russia
+ 7-495-9569508 (Phone)

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