Purpose This paper studies the political economy of the endogenous urban-rural divide in two dimensions: labor market and provision of public goods. Design/methodology/approach This paper gives a dual-sector model endogenously depending on the consumption of public goods (club goods), the number...

Majority rules are frequently used to decide whether or not a public good should be provided, but will typically fail to achieve an efficient provision. We provide a worst-case analysis of the majority rule with an optimally chosen majority threshold, assuming that voters have independent...

How should a group of people decide to allocate a task that has to be done but is not adequately rewarded? This paper finds an optimal mechanism for the private provision of a public service in an environment without monetary transfers. All members of the group have the same cost of providing...