Previous literature has shown that public provision of private goods can be a welfare-enhancing device in second-best settings where governments pursue redistributive goals. However, three issues have so far been neglected. First, the case for supplementing an optimal nonlinear income tax with...

Agents frequently have different opinions on where to locate a public facility. While some agents consider the facility a good and prefer to have it nearby, others dislike it and would like to see it built far away from their own locations. To aggregate agents' preferences in these situations,...

This paper analyses the optimal tax policy and public provision of private goods when individuals differ in two respects: income-earning ability and rationality. Publicly provided goods should be overprovided or subsidised, relative to the decentralised optimum, if society's marginal valuation...