67 research outputs found

    On the Core of an Economy with Multilateral and Multidimensional Environmental Externalities

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    For simple economic models of transfrontier pollution, Chander and Tulkens (1995) and (1997) have offered a formula for transfers to sustain international cooperation on a voluntary basis and which deter coalitional free-riding under some reasonable behaviours of countries not in the coalition. Their scheme rests on the assumption that pollution is a scalar. Relaxing this assumption, interesting interactions among pollutations arise that call for a new formula. In this paper we extend Chander and Tulkens formula for this more realistic multidimensional context, and thereby enhance the practical and theoretical relevance of their seminal analysis.international pollutions, Nash equilibrium, partial agreement Nash equilibrium, international transfers

    Relative performance of two simple incentive mechanisms in a public good experiment

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    This paper reports on experiments designed to compare the performance of two incentive mechanisms in public goods problems. One mechanism rewards and penalizes deviations from the average contribution of the other agents to the public good (tax-subsidy mechanism). Another mechanism allows agents to subsidize the other agents’contributions (compensation mechanism). It is found that both mechanisms lead to an increase in the level of contribution to the public good. The tax-subsidy mechanism allows for good point and interval prediction of the average level of contribution. The compensation mechanism allows for less reliable prediction of the average level of contributions.public goods, voluntary provision, incentive mechanisms

    Matching Grants and Ricardian Equivalence

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    This paper questions the effectiveness of matching grants to correct for interjurisdictional spillovers in the light of Bernheim general neutrality result. Indeed this result suggests that the usual argument that matching grants are needed to internalize the externality arising from the existence of interjuridictional spillovers is an artifact of the assumption that jurisdictions neglect the impact that their decisions have on the federal budget. Relaxing this assumption and using a classical model where the arbitrage resulting from labor mobility implies that redistribution has the properties of a public good, we find that matching grants are relevant although much less effective. We also find that optimal matching rates are independent of the jurisdictions' choice of policy variable contrarily to the case where jurisdictions ignore the impact of their decisions on the federal budget.Fiscal federalism, Ricardian equivalence, Matching grants

    FISCAL COMPETITION AND PUBLIC EDUCATION IN REGIONS

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    We explore an economy with two regions and independent local administrations. Local governments collect taxes to finance public education, but once educated agents can choose to migrate to the other region. The Nash equilibrium of the long-run game between the two governments is compared to a golden rule-type social optimum. Preliminary results show that the Nash equilibrium will result in over- or under-investment depending on the extent to which public education is subject to congestion.Successive generations, Public education, Federal and local government, Fiscal games.

    Weak moral motivation leads to the decline of voluntary contributions

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    This paper provides a general framework that accounts for the decay of the average contribution observed in most experiments on voluntary contributions to a public good. Each player balances her material utility loss from contributing with her psychological utility loss of deviating from her moral ideal. The novel and central idea of our model is that people.s moral motivation is "weak": their judgement about what is the right contribution to a public good can evolve in the course of interactions, depending partly on observed past contributions and partly on an intrinsic "moral ideal". Under the assumption of weakly morally motivated agents, average voluntary contributions can decline with repetition of the game. Our model also explains other regularities observed in experiments, in particular the phenomenon of over-contributions compared to the Nash prediction and the so-called restart e¤ect, and it is compatible with the conditional cooperation hypothesis.

    Vountary matching grants can forestall social dumping

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    The European economic integration leads to increasing mobility of factors, thereby threatening the stability of social transfer programs. This paper investigates the possibility to achieve by means of voluntary matching grants both the optimal allocation of factors and the optimal level of redistribution in the presence of factor mobility. We use a fiscal competition model a la Wildasin (1991) in which states differ in their technologies and preferences for redistribution. We first investigate a simple process in which the regulatory authority progressively raises the matchning grants sto the district choosing the lowest transfer and all districts respond optimally to the resulting change in transfers all around. This process is shown to increase total production and the level of redistribution. However, it does not guarantee that all districts gain, nor that an efficient level of redistribution is attained. Assuming complete information among districts, we first derive the willingness of each district to match the contribution of other districts and we show that the aggregate willingness to pay for matching rates converges to zero when both the efficient level of redistribution and the efficient outcome and guarantee that everyone will gain.Fiscal federalism, Adjustment process, Matching grants

    Weak moral motivation leads to the decline of voluntary contributions

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    We develop a model that accounts for the decay of the average contribution observed in experiments on voluntary contributions to a public good. The novel idea is that people’s moral motivation is "weak". Their judgment about the right contribution depends on observed contributions by group members and on an intrinsic "moral ideal". We show that the assumption of weakly morally motivated agents lead to the decline of the average contribution over time. The model is compatible with persistence of over-contributions, variability of contributions (across and within individuals), and the “restart effect”. Furthermore, it offers a rationale for conditional cooperation. Cet article présente un modèle théorique qui permet d’expliquer le déclin des contributions observé dans les expériences de contribution volontaire au financement de biens publics répétés à horizon fini. Ce modèle s’appuie sur l’idée de motivation morale faible selon laquelle les agents auraient une motivation intrinsèque à contribuer un montant non nul au bien public et que cette motivation intrinsèque serait conditionnée à l’observation des contributions des autres membres du groupe. Ce modèle est compatible avec la persistance de la sur-contribution, la variabilité inter et intra individuelle dans les montants de contributions et l’effet de « restart ».Conditional cooperation, voluntary contributions, moral motivation, experiments on public goods games, coopération conditionnelle, contributions volontaires, motivation morale, expériences de biens publics

    [Exploitation durable d'une ressource naturelle : utilisation concluante du critère de Chichilnisky]

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    International audienceLes auteurs discutent et analysent le concept de durabilité dans le cas de l'exploitation d'une ressource naturelle. A partir du traité de Rio en 1992, plusieurs travaux ont fait l'effort de définir l'idée de la durabilité (voir Pezzey 1992 pour un résumé des différents concepts). Ils considèrent le critère de Chichilnisky. Si on accepte les axiomes de non dictature du présent et du futur (et des autres axiomes plus techniques), on est face à la non-existence de solution du critère. Dans le document, les auteurs proposent la restriction de l'ensemble d'exploitations possibles de façon à obtenir l'existence d'une solution optimale dans cet ensemble. Ils analysent la procédure à un simple modèle d'exploitation d'une ressource et ils étudient aussi la relation entre interaction, stratégique et coopération

    On the core of an economy with multilateral and multidimensional environment externalities

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    For simple economic models of transfrontier pollution, Chander and Tulkens (1995) and (1997) have offered a formula for transfers to sustain international cooperation on a voluntary basis and which deter coalitionnal free-riding under some reasonable behaviours of countries not in the coalition. Their scheme rests on the assumption that pollution is a scalar. Relaxing this assumption, interesting interactions among pollutants arise that call for a new formula. In this paper we extend Chander and Tulkens formula for this more realistic multidimensional context, and thereby enhance the pratical and theoretical relevance of their seminal analysis

    Managing natural resources without forgetting future generations: Two alternatives to discounting

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    Our current choices regarding the fight against deforestation and climatic disorder, against the overexploitation of natural resources or the erosion of ecologic heritage, have effects which will last long after we disappear. Must we make immediate and major sacrifices for the well-being of our descendants? Speaking only about developed countries, they will anyway be better off than we are if the trend in growth observed for the last two centuries continues. Unless, as scientists and GIEC Experts who work on biodiversity and ecosystem services fear, we are approaching the natural limits which commit here and now our responsibility towards future generations. In a context where current choices have uneven distributed effects in time, how do we arbitrate between the present and future, between the interests of the various generations? One way of considering the problem is to incorporate some normative requirements into a criterion of inter-temporal social choice, and estimate the legitimacy of alternative futures according to their classification by this criterion. This approach results in a general message as important as it is frustrating: looking for the trajectories of management which avoid waste cannot usually be achieved without favouring certain generations. Therefore, the concern for our descendants can be summed up to one question: what are the desirable compromises between efficiency and impartiality? Discounting the utilities of every generation before adding them together is a possible answer. But such a criterion, for a long time applied by default, presents an all the more contestable discrimination against future generations, all the more so as alternatives exist. This note briefly presents the works of the scientists of the SAE2 department on two alternatives to discounting. Chichilnisky’s criterion and the mixed Bentham-Rawls (MBR) criterion are two possible answers to the efficiency-impartiality dilemma
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