000			03035cam a22003137 4500
001			w0954
003			NBER
005			20211020115340.0
006			m o d
007			cr cnu||||||||
008			210910s1982 mau fo 000 0 eng d
100	1		_aStiglitz, Joseph E.
245	1	4	_aThe Theory of Local Public Goods Twenty-Five Years After Tiebout: _bA Perspective / _cJoseph E. Stiglitz.
260			_aCambridge, Mass. _bNational Bureau of Economic Research _c1982.
300			_a1 online resource: _billustrations (black and white);
490	1		_aNBER working paper series _vno. w0954
500			_aAugust 1982.
520	3		_aThis paper asks, under what conditions can the Fundamental Theorem of Welfare Economics be extended to economies with local public goods? We show that there are some fairly restrictive sets of assumptions under which a competitive local public goods equilibrium (if it exists) is efficient; more generally, however, competitive local public goods equilibria may be inefficient in the allocation of individuals among communities, in the number of communities, and in the level and kinds of public goods provided. The primary sources of inefficiency are identified and analyzed; these "market" failures are closely related to some important policy issues concerning, for instance, urban concentralization, fiscal decentralization, and regional redistribution. In communities in which landlords control the public sector, the level and kinds of public goods provided may be incorrect, and what goods are provided are supplied inefficiently. In contrast, in communities in which renters control the public sector, there are no incentives for efficiency in the supply of public goods. Because of what we refer to as rental capitalization, there may in fact be perverse incentives with respect to the kinds of public goods or "bads" provided. Not only is it the case that not every competitive equilibrium is Pareto optimal, but not every Pareto efficient allocation can be sustained by a competitive local public goods equilibrium (with the appropriate lump sum redistributions) . Just as the Fundamental Theorem of Welfare Economics does not adequately reflect the vices and virtues of competition in the market economy with purely private goods, so too here: the virtues of a decentralized mechanism for providing public goods may be vastly underestimated by our analysis.
530			_aHardcopy version available to institutional subscribers
538			_aSystem requirements: Adobe [Acrobat] Reader required for PDF files.
538			_aMode of access: World Wide Web.
588	0		_aPrint version record
690		7	_aE - Macroeconomics and Monetary Economics _2Journal of Economic Literature class.
710	2		_aNational Bureau of Economic Research.
830		0	_aWorking Paper Series (National Bureau of Economic Research) _vno. w0954.
856	4	0	_uhttps://www.nber.org/papers/w0954
856			_yAcceso en línea al DOI _uhttp://dx.doi.org/10.3386/w0954
942			_2ddc _cW-PAPER
999			_c347628 _d306190