Why study the economy? -- The evolving economy and economics -- Markets as economic institutions : supply and demand -- Governments and nonprofits as economic institutions -- The twin problems of unemployment and underemployment -- The kitchen table economy : keeping up with rising costs --...

We study the effect of electoral incentives on the allocation of public services across legislative districts. We develop a model in which elections encourage individual legislators to cater to parochial interests and thus aggravate the common pool problem. Using unique data from seven US...