FEEM working papers "Note di lavoro" series
2005 .039

The Egalitarian Sharing Rule in Provision of Public Projects


Authors: Alexei Savvateev, Anna Bogomolnaia, Michel Le Breton, Shlomo Weber
Series: Climate Change and Sustainable Development
Editor: Carlo Carraro
Type: Journal
Keywords: Jurisdictions,Stable partitions,Public projects,Egalitarianism
JEL n.: C71,C72,D63,H41
JEL: Economics Bulletin
Pages: Vol. 8, No.1, pp. 1-5
Date: 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.

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