2010
DOI: 10.1016/j.jpubeco.2010.03.003
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Optimal democratic mechanisms for taxation and public good provision

Abstract: We study the interdependence of optimal tax and expenditure policies. An optimal policy requires that information on preferences is made available. We first study this problem from a general mechanism design perspective and show that efficiency is possible only if the individuals who decide on public good provision face an own incentive scheme that differs from the tax system. We then study democratic mechanisms with the property that tax payers vote over public goods. Under such a mechanism, efficiency cannot… Show more

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Cited by 9 publications
(1 citation statement)
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“…Apart from optimizing government expenditures to provide public services, efficiency also lies in the allocation of income, mainly from taxation. Bierbrauer and Sahm () claimed that the composition of tax revenue should not be ignored, while Bierbrauer () analyzed the conditions for optimal taxation. Also, Gemmell and Au () stated the impact of fiscal policies on economic growth.…”
Section: Introductionmentioning
confidence: 99%
“…Apart from optimizing government expenditures to provide public services, efficiency also lies in the allocation of income, mainly from taxation. Bierbrauer and Sahm () claimed that the composition of tax revenue should not be ignored, while Bierbrauer () analyzed the conditions for optimal taxation. Also, Gemmell and Au () stated the impact of fiscal policies on economic growth.…”
Section: Introductionmentioning
confidence: 99%