Equitable and Efficient Federal Structures with Decentralized Leadership, Spillovers, and Attachment of Heterogeneous Labor
Relying on differentiability assumptions and on conditions that guarantee interior solutions, we show that a federation featuring decentralized leadership, interregional spillovers, and labor attachment allocates resources efficiently under two sets of circumstances. The first is when the center is Rawlsian. The second is when individual utilities are quasi-linear, regional welfare functions are Benthamite, and the center's objective function is a Bergson-Samuelson transformation of regional welfare levels, which also satisfies conditions needed for the center to view regional welfare levels as normal goods. In both sets of circumstances, efficient behavior follows from incentive equivalence promoted by the center's egalitarian transfers. Copyright © 2010 Wiley Periodicals, Inc..
Year of publication: |
2010
|
---|---|
Authors: | AOYAMA, NAOTO ; SILVA, EMILSON C. D. |
Published in: |
Journal of Public Economic Theory. - Association for Public Economic Theory - APET, ISSN 1097-3923. - Vol. 12.2010, 2, p. 323-343
|
Publisher: |
Association for Public Economic Theory - APET |
Saved in:
freely available
Saved in favorites
Similar items by person
-
Regional Cohesion Maintenance, Spillovers, and Imperfect Labor Mobility
Aoyama, Naoto, (2014)
-
Abatement innovation in a cournot oligopoly : emission versus output tax incentives
Aoyama, Naoto, (2016)
-
Asymmetric innovation agreements under environmental regulation
Aoyama, Naoto, (2017)
- More ...