Gasoline taxes are the most important tax on car use. The question naturally arises as to what tax would be adopted by a government that responds to the preferences of the public. To address that issue, we begin with the standard Downsian model, where policy is determined by the median voter....

Given the difficulty of monitoring, and even more so of enforcing, International Environmental Agreements, it is surprising that they are signed and implemented. This paper offers a theoretical model, which addresses this issue. The focus is on informational and coordination problems. A country...

We examine how diversification of projects assigned to an agency can enhance efficiency by informing a principal of the agency’s quality. Projects that appear inefficient in isolation may be justified when assigned to the same agency. Assigning different tasks to different special purpose...

Central governments often subsidize capital spending by local governments, instead of subsidizing operating expenses or labor-intensive projects. This paper offers one explanation, focusing on the incentive effects for local officials. a local official can more easily shift the cost of...

A winning coalition which sets policy cannot always ensure that members of the coalition will be the ones getting benefits. Different jurisdictions (including members of the winning coalition) may then engage in costly rent seeking. Maximizing the welfare of the winning coalition may therefore...