inflation and reputation in many macroeconomic models with rational expectations optimal policy is time inconsistent and therefore announced policy may not be credible this paper models the government s credibility explicitly using kreps and wilson s analysis time consistent optimal government policy emerges as a sequential equilibrium in a repeated game this policy is at least as good as the inconsistent optimal policy and dominates the consistent policy when reputational effects are ignored thus the analysis resolves the problem of specifying a credible optimal policy in such models the results show why attempts to disinflate may lead to recession even with perfectly flexible prices this abstract was borrowed from another version of this item

congested public goods the case of fire protection abstract this paper uses a fire protection measure based on a community s fire insurance rating to estimate the strength of congestion effects for fire protection services the empirical results show that the congestion properties of fire protection are much like those of a pure public good in addition the paper introduces a new notion of returns to scale for public goods and estimates the relevant parameters for the fire protection case

micro estimates of public spending demand functions and tests of the tiebout and median voter hypotheses responses to questions given to a random sample of michigan households are used to estimate public spending demand functions while income and price elasticities are similar to those obtained from aggregate data positive income elasticities appear to arise because public services are distributed in a prorich manner a relatively small variance in spending demands among urban and suburban communities in metropolitan areas with substantial public service variety suggests that the tiebout mechanism works this interpretation is supported by the fact that actual spending conforms substantially to desired levels in urban areas but less so in rural areas with little public sector choice

the lucas critique and the volcker deflation this paper examines in light of the lucas critique the behavior of the phillips curve and of the term structure of interest rates after october 1979 it starts with an informal account of the policy change and then discusses how we might expect these two relations to shift after such a change it finds little evidence of a direct effect of the policy change on the phillips curve at least until 1982 it finds substantial evidence of a direct effect on term structure this abstract was borrowed from another version of this item

bureaucracy and the divisibility of local public output further econometric evidence based on the theory of bureaucracy in contrast to the median voter model expenditure functions are estimated for various municipal services provided by some smsa cities various econometric measures and diagnostics are applied to the sample data to test for the incidence of multicollinearity heteroscedasticity and influential observations the test results indicate the absence of any econometric problems and the empirical results can be taken as statistically meaningful and to a large extent precise over the range of smsa cities included in the estimated model the presented econometric evidence points out that in these communities the municipal services are private in nature and there exist no economies of scale in the provision of these services although these services reveal no pure publicness or quasi publicness they are provided by local governments through a collective choice mechanism perhaps due to the inherent problems associated with their provision such as the cities lack of knowledge of individuals preferences and tastes and the anticipated potential free rider problem

the rationally uninformed electorate some experimental evidence this essay reports on a series of twenty four election experiments in which voters are allowed to decide between voting retrospectively and purchasing contemporaneous information about the candidate challenging the incumbent each experiment consists of a series of election periods in which dummy candidates choose spatial positions which represent either their policy while in office or a promise about policy if elected subjects voters are told the value to them of the incumbent s policy but they must decide prior to voting whether or not to purchase information about the value of the challenger s promise in general our data conform to reasonable expectations voters purchase less information and rely more on retrospective knowledge when the candidates strategies are stable and their likelihood of purchasing information during periods of instability is tempered by the likelihood that their votes matter by the reliability of the information available for purchase and by the degree of instability as measured by changes in each voter s welfare

congestion function specification and the publicness of local public goods abstract this paper is about the measurement of congestion within the median voter demand framework the model of congestion traditionally used in the literature and four others are compared and tested in a median voter framework the results show that a more flexible functional form which imposes fewer a priori restrictions on the data does at least as good a job of explaining variations in local government expenditures furthermore it is shown that measured publicness of local public goods depends entirely on the a priori restrictions imposed on the congestion function

the phillips curve parameter instability and the lucas critique empirical estimation of phillips curve relationships typically indicates the presence of parameter instability this is argued to be due to the fact that the parameters of these equations are reduced form rather than structural parameters estimation of a phillips curve model by methods which allow for time varying parameters permits investigation of the nature and timing of the structural breaks which generate instability this paper estimates such a model by the kalman filter using quarterly data over the period 1972 4 to 1993 3 we find evidence of a gradual decline in the private sector s assessment of the steady state inflation rate during the 1980s but little evidence of the sort of dramatic regime shift predicted by some of the more extreme rational expectations models

on the measurement of congestion in the provision of local public goods abstract this paper contends that a measurement problem the zoo effect has led to upwardly biased estimates of the degree to which local public goods are subject to congestion the suggestion is that the observed positive correlation between public expenditure and population size reflects in large measure the wider range of services provided in more populous jurisdictions not simply a high propensity of these goods to become congested

productivity change in state and local governments a model is developed in this paper which allows the growth rate of public sector productivity to be estimated without an explicit measure of sectoral output in this model communities are regarded as generalized households and the goods and services provided by the community s government are interpreted as internally produced household goods the model is then fitted to quarterly data from the u s national income and product accounts and the rate of productivity change is found to average 0 50 per year for the period 1959 1979 the sources of growth approach to productivity measurement distinguishes between the growth in real output due to the growth in factor inputs capital labor materials and the growth in output due to advances in technology managerial practice and other factors related to productive efficiency the former are collectively associated with the movement along an aggregate or sectoral production function while the latter are associated with the shift in that function 2 in practice the shift in the production function is measured by the residual real output not attributed to the growth of the share weighted inputs and termed total factor productivity the sources of growth model is based on the underlying assumption that real output and real input can be measured with a reasonable degree of accuracy while this presumption is correct for many types of economic activity it is essentially incorrect for those sectors which produce services as kendrick 1982 has recently noted approximately one third of the real gross product originating in the service sector of u s private business economy is estimated using employment manhours or labor earnings such procedures systematically misstate the true growth of real output and thus systematically bias the estimated growth in total factor productivity the situation is even worse in the public sector in the u s national income and product accounts the output of general government is defined to be equal to labor input implying that the growth of total factor productivity exactly offsets the effect of nonlabor inputs a model is developed in this paper which allows the growth rate of public sector productivity to be estimated without an explicit measure of sectoral output in this model communities are regarded as generalized households and the goods and services provided by the community s government are interpreted as internally produced household goods this interpretation allows us to appropriate the analytical apparatus of the household production model and thereby permits us to estimate the key parameters of the model including a government total factor productivity parameter without first having to measure the output of the govern

cost sharing versus block funding in a federal system a demand systems approach this paper employs a maximizing framework consistent with the axioms of consumer preference to analyze local government s choice of spending on different social services within this framework it is possible to include both block funding and cost sharing intergovernment transfer schemes canada s movement to block funding from the cost sharing method of financing provincial expenditures on hospitals medical care and post secondary education is analyzed the results indicate that the provincial governments actions are generally consistent with a significant maximizing model of consumer behavior and that the change to block funding had a significant impact on real provincial funding of some previously cost shared social services

revealed preferences between public expenditures and taxation cuts public sector choice abstract a survey was carried out in england and wales to provide information on how people would allocate a sum of money between increases in government spending and lowering taxes by means of a coupon scale questionnaire relatively new to this country and used for the first time to ascertain choice at the central and local government level we hoped to overcome the problem of getting people to reveal their true preferences statistical analysis of the data reveals some significant differences in responses

the causes of government expenditure growth a survey of the u s evidence abstract the growth of government budgets can be broken down into a institutional and institutional components the former component the familiar substitution income and population public goods tax sharing effects is estimated to contribute about two fifths of the growth of u s government spending the latter component rent seeking political redistributions bureaucracy and perceptual informational impedimentia is important too but an exact imputation cannot be asserted given the state of the art in empirical public choice theory the cross effects on spending of the growth of regulation and tax preferences or tax expenditures though interesting is not pursued

inflation and unemployment the world economy today is vastly different from the 1930s when seymour harris the chairman of this meeting infected me with his boundless enthusiasm for economics and his steadfast confidence in its capacity for good works economics is very different too both the science and its subject have changed and for the better since world war ii but there are some notable constants unemployment and inflation still preoccupy and perplex economists statesmen journalists housewives and everyone else the connection between them is the principal domestic economic burden of presidents and prime ministers and the major area of controversy and ignorance in macroeconomics i have chosen to review economic thought on this topic on this occasion partly because of its inevitable timeliness partly because of a personal interest reaching back to my first published work in 1941

equilibrium in fiscal choices evidence from a budget game this is an applied study about the stability of collective decision making in fiscal matters and the features of individual preferences which are sufficient to reach a social ordering it is based on data about citizens preferences collected through a budget game played by a sample of voters in turin a large italian city by simulating a series of individual choices a social ordering of the municipal budget items is arrived at the role played by restricted i e single peaked single caved etc preferences to avoid cycles in choice simulations is then assessed

the stability of the turkish phillips curve and alternative regime shifting models this article presents empirical evidence supporting instability of the phillips curve in turkey we employ the multiple structural break models and the markov switching models and then evaluate the performance of the two models the data pertain to the monthly inflation rate in turkey for the period of 1987 to 2004 the results show that the turkish phillips curve is not linear there exists no evidence on the asymmetry in the inflation response to output gap the persistence of inflation is found to be much lower than in linear models after 2001 slight decline in persistence of inflation is observed there exits weaker support for the phillips curve for the periods where the policymakers attempt to take the advantage of the tradeoff between output and inflation relationship

elections and aggregation interpreting econometric analyses of local governments this paper analyzes the provision of local government service under the assumption that fiscal policy is set by local officials in order to maximize the expected number of votes in the next election the model includes both the widely used median voter model and the average voter model as special cases further it is a convenient framework for empirical analyses numerical simulations indicate that the vote maximization model is capable of producing levels of government spending either greater or less than those predicted by the median voter model while exhibiting similar responses to changes in incomes grants prices etc thus the model captures the advantages of the median voter model without its objectionable features many avenues for further work remain i will mention briefly only a few of the most obvious the first is to make housing prices endogenously determined within the model in this way one could examine the role of both fiscal incentives capitalization and political incentives votes in the determination of optimal policies a second extension is to introduce explicitly the possibility of a mobile population and examine in the spirit of tiebout 1956 the effects of voting with your feet within the vote maximization framework the possibilities include both setting policies that de facto concede exit of some fraction of the current residents and or setting policies to attract new residents with particular characteristics another extension is to look at decisions over time despite widespread agreement upon the usefulness of the life cycle model of private consumption the median voter is essentially static it seems a minimal extension to include both government and private consumption in an intertemporal framework unfortunately the median voter may change over time making implementation of the median voter model problematic at best in practice intertemporal issues are important emphasizing the absence of an acceptable framework it is often suggested that elected officials will choose inappropriate intertemporal fiscal policies in response to the short run focus of the electoral process for example it appears plausible that officials will borrow in order to finance higher levels of spending and or lower taxes in the present because future residents are not present to vote against these policies the electoral process produces incorrect incentives in the same way this line of reasoning suggests that officials will undertake too little infrastructure investments because the benefits accrue to future residents one countervailing force is the effects of property capitalization to the extent that the local housing market correctly capitalizes future taxes and services into housing values current residents will be affected by inefficient policies and may use the electoral process to provide correct signals to officials there is another possibility as well to the extent that current officials recognize that inefficient current policies reduce the probability of future re election they have an incentive even in the absence of perfect capitalization to adopt intertemporally appropriate tax and spending policies intuitively the official must care about re election what if the particular individual chooses not to run for office again then to the extent that political parties or machines cause the individual to value the election of his successor i e to the extent that political legacies are important the adopted policies may satisfy the conditions for intertemporal efficiency the vote maximization approach provides a framework in which to analyze these issues lastly one could extend the model to situations in which officials care not only about election but also about the policies themselves this provides not only a different tradeoff between the tastes of the public and private sector but also a natural incentive for officials to seek re election

a note on the publicness of local goods evidence from new york state municipalities for more than a decade now the non publicness of goods provided by local governments has been an accepted result in the median voter demand literature mcmillan wilson and arthur 1981 found that publicness was exhausted in ontario towns of more than 10 000 inhabitants but that there were still unexploited economies to collective provision in smaller towns using the original bergstrom and goodman 1973 model and new york state data i find that there is even less evidence of publicness in small towns than in large ones my results call into question the mcmillan wilson and arthur hypothesis une note sur le degre de materialite publique d usage des biens locaux le cas des municipalites de b etat de new york depuis plus d une decennie l un des resultats de la litterature specialisee analysant le comportement de demande du voteur median a ete que les biens fournis par les gouvernements locaux n etaient pas des biens publics mcmillan wilson et arthur 1981 ont montre que le degre de materialite publique d usage etait limite dans le cas des villes de plus de 10 000 habitants en ontario mais qu il existait des economies inexploitees emanant de la fourniture publique dans le cas des plus petites villes a partir du modele de bergstrom et goodman 1973 et de donnees pour l etat de new york l auteur en arrive a la conclusion qu il y a encore moins de materialite publique d usage dans les petites villes que dans les grandes ces resultats remettent en question l hypothese mcmillan wilson et arthur in contrast to the strict samuelsonian dichotomy of pure public and pure private goods the tiebout 1956 and buchanan 1965 models plot goods along a continuum of congestability goods provided by local governments or collectively purveyed and consumed in clubs are described as lying somewhere between the two polar cases the median voter demand model as developed by borcherding and deacon i would like to thank wallace oates william oakland suk kang and an anonymous referee for helpful comments on earlier drafts of this paper they are of course exonerated from association with such errors as may still remain canadian journal of economics revue canadienne d economique xix no 3 august aout 1986 printed in canada imprime au canada 0008 4085 86 568 573 1 50 canadian economics association this content downloaded from 157 55 39 102 on mon 03 oct 2016 05 08 06 utc all use subject to http about jstor org terms publicness of local goods 569 1972 and bergstrom and goodman 1973 incorporates this hypothesis observed levels of local public expenditures are said to reflect the preference of the median voter however the empirical models also include a congestion function intended to reflect the effect of collective consumption on individual enjoyment the function used in the literature is of the form

bureaucracy monopoly and competition a critical analysis of the budget maximizing model of bureaucracy niskanen has argued that if government bureaus act so as to maximize their budgets they will always produce an output greater than a private industry resulting in efficiency losses to society since the budget maximizing model relates to a number of intersecting areas of organizational analysis from several disciplines it is important to note the limitations of the model first niskanen s result is only true for a bureau which can exercise perfect price discrimination in its relationship with its financial sponsor where this is not the case the bureau may produce less than a private industry second further variation is introduced by examining the effects on a bureau of specialized resources public goods competition and low productivity a bureau which would otherwise produce an output in excess of the competitive level will when any of these factors are present produce an output closer to the competitive output these results may also have significant policy implications since major industrial countries are favoring policies to return some governmental activities to the private sector

infrastructure provision and macroeconomic performance this paper studies the differences between private and government provision of infrastructure capital utilization decisions and their differential role in determining market prices for capital goods under the two regimes of infrastructure provision serve as a critical transmission mechanism for fiscal policy a subsidy to private providers of infrastructure is preferable to direct government provision irrespective of how the subsidy or expenditure is financed the case for private provision is much stronger in economies characterized by high levels of congestion the choice between private and government provision also has a crucial effect on the design of optimal fiscal policy 2011 elsevier b v all rights reserved

urban safety in vancouver allocation and production of a congestible public good this paper is a simultaneous exploration of the within city production of safety with the endogenous allocation of public inputs police three issues are central one is an examination of the local government allocation function second is that safety is specified as a congestible public service consistent with club theory finally the model is estimated using a survey measure of crime these innovations are due to a unique data set containing observations by neighborhoods in the city of vancouver the results are crucial for illustrating crime deterrence as well as the local public good nature of safety

bureaucracy and the publicness of local public goods a reply to gonzalez folsom and mehay readers of the literature on bureaucracy will recall that three years ago gonzalez and mehay 1985 published an empirical piece utilizing a slack maximizing model of bureaucratic behavior which concluded that local public goods are really private goods my own article wyckoff 1988a reached the same conclusion using theoretical means the effect of bureaucracy i argued is to bias our results toward the conclusion that local public goods are public in nature so the empirical results showing the opposite cannot be blamed on bureaucracy now in a surprising comment on my paper gonzalez folsom and mehay 1988 gfm assert that i made methodological errors in the process of establishing my result not content with my agreement with their conclusions gfm demand that i reach these results using their methodology gfm insist that i ignore four special cases in my paper each one of these special cases is discussed below in general i find little merit in their arguments each special case is either obviously unrealistic or relates to a question completely different from those discussed in my paper first of all gfm argue that i fail to note that the voter s tax share t is likely to vary with city population n when this correlation is incorporated into my model they say the reverse of my results could occur but there is a fundamental error in allowing t to vary with n the issue in this paper is not whether large cities spend more than small cities nobody disputes this but whether local public goods are public goods or not what we want to know is whether two people can enjoy a public service just as easily as one by including tax considerations in the calculations as they have done gfm confuse crowding effects with changes in spending caused by changes in tax burdens when t is allowed to vary with n we no longer have a measure of the crowding parameter but a composite which cannot answer the question we originally asked an analogy may help clarify gfm s error gfm s approach is equivalent to suggesting that since wealthy people have larger homes and hence larger tax

why so much stability one of duncan black s 1958 more important contributions was a classically simple proof that with complex issues and majority voting a stable outcome is unlikely this very simple proof that there would normally be no motion which can get a majority against all others and hence that any possible outcome is dominated by another has been elaborated and made more precise by later work without most improbable conditions endless cycling would be expected this is particularly true when logrolling is present as it normally is if we look at the real world however we observe not only is there no endless cycling but acts are passed with reasonable dispatch and then remain unchanged for very long periods of time thus theory and reality seem to be not only out of contact but actually in sharp conflict it is the purpose of this article to demonstrate that our existing theory when properly looked at does indeed imply a relatively stable outcome to voting in some cases however this stability will not be a true equilibrium because a random member of a large set will be chosen and then that random outcome will be left unchanged for long periods of time it does not dominate all other outcomes but is retained merely because of its particular history there are already several possible explanations for the observed stability in the literature we will take them up as they become relevant to the general line of reasoning i should however warn the reader that my own previous work including joint work with buchanan will play a major role here this may simply reflect egotism but i think that some of the early work which is now partially forgotten can provide solutions for more modern problems much recent public choice work has involved spatial models and these models frequently ignore logrolling the reason presumably is that it is very hard to put logrolling in a two dimensional diagram we shall begin considering such special models and assume that the issues are the sort that does not lead to logrolling and then turn to more complex logrolling problems with respect to the first situation in which logrolling does not occur there is already one possible explanation for the observed stability in the literature

the publicness of local public goods evidence from ontario municipalities recent studies of local public good provision report publicness parameter estimates of about one indicating private good characteristics this empirical investigation of a wider range of communities obtains parameter estimates of significantly less than one indicating a high degree of publicness exists in smaller municipalities and within the service areas of individual public facilities comprising the supply network in larger centres it is argued that the observed values of the publicness parameters have no normative significance as to the merits of public versus private provision la materialite publique d usage des biens publics locaux resultats d une etude de municipalites ontariennes les etudes recentes sur l approvisionnement de biens publics locaux indiquent des coefficients de materialite publique d usage autour de l unite c est a dire que les biens publics locaux ont de fortes caracteristiques semblables aux biens prives ce memoire presente les resultats d un enquete empirique d un large eventail de communaut6s locales et en arrive a des valeurs pour le coefficient de materialite publique d usage qui sont bien moins que l unite et qui donc indiquent un haut degre de materialite publique d usage dans les petites municipalites mais aussi dans les zones de service d infrastructures particulieres parc bibliotheque poste de pompier etc qui forment le reseau d approvisionnement de biens publics dans les grands centres les auteurs suggerent que les valeurs observees de ces coefficients de materialite publique d usage n ont aucune portee normative et donc ne sauraient arbitrer les merites relatifs d un approvisionnement prive ou public de certains biens

the nonexcludable publicness of primary and secondary public education abstract existing theoretical models of education as with most practical applications of public good theory suggest some form of joint public private financing empirical work has only rarely addressed these theoretical considerations employing individual level observations we model and estimate the private and social demands for public education in a community an ordered probit model with known thresholds is used to obtain unique parameter estimates the individual private and social demands are then employed to construct a measure of the publicness of education at various quantities

bureaucracy and the divisibility of local public output the empirical results of this paper are derived from a monopoly view of local government decisionmaking in contrast to the competitive view offered by earlier researchers that our results are similar to earlier findings lends additional support to the conclusion that local output is largely private in nature other than park and recreation services there appear to be no economies in consumption for local services nor any economies of density larger cities do not appear to be more efficient than smaller cities 10 of course this result holds only for the sample of cities used here and does not rule out scale economies for communities smaller than those in our sample i e below 25 000 population

the impact of congestion on local public good production abstract this paper models local public goods production where allocation of the publicly provided input occurs simultaneously with production of the final service output the framework models local public goods as developed in club theory where congestion is an increasing function of population central to identification of the model is that the quantities of the input police are differentiated from the produced output safety estimation is across neighborhoods within a single city the results show there is a very low elasticity of congestion on average but safety in some neighborhoods in more congested than private goods

recent changes in macro policy and its effects some time series evidence has the macroeconomic policy regime changed in the united states in the last few years if so has this change had an effect on macroeconomic relationships and in particular on the relationship between inflation and unemployment these two questions have been on the minds of most macroeconomists since the october 1979 switch from interest rates to reserves as an intermediate target for the federal reserve and the explicit endorsement of monetarism by the reagan administration in early 1981 the questions are important not only for predicting the course of the economy in the future but also for assessing the practical significance of the lucas critique according to this critique a change in policy regime should cause changes in the way the economy operates comparing economic relations before and after a change in regime should provide a test of the critique the approach in many recent studies has been to assume that the answer to the first question is yes that there has been a significant change in the macroeconomic policy regime and to look for changes in the phillips curve as a test of the lucas critique thus far the results have been mixed otto eckstein 1983 steven englander and cornelis los 1983 and george perry 1983 conclude that there has been no significant change in the phillips curve relationship phillip cagan and william fellner 1983 and wayne vroman 1983 find some evidence of a change wage inflation has come down more quickly especially in 1982 and early 1983 than would be predicted from a phillips curve however the assumption that there has been a regime change has received little empirical attention the october 1979 switch from interest rate targetting to reserve targetting at the fed is usually taken as prima facie evidence of a significant change in policy regime but such changes in operating procedures per se do not necessarily entail a change in policy regime relevant for macroeconomic purposes if they did then the renewed emphasis on interest rates rather than reserves starting in late 1982 should be cited as evidence of a return to the old regime a view which few researchers have taken in fact studies have shown that either interest rates or reserves can be used as intermediate targets for controlling the money supply and ultimately aggregate demand the choice between the two depends on whether shocks to the money markets are from the demand side or the supply side the issue of importance for assessing whether a regime change has taken place is how much the fed reacts by adjusting the money supply appropriately defined in response to conditions in the economy the procedure it uses to bring about this response is irrelevant 2 implicit in a macroeconomic policy regime is a rule relating the money supply to economic con 404 woodrow wilson school princeton university princeton nj 08544 this research was supported by a grant from the national science foundation at the national bureau of economic research and conducted in part at the federal reserve bank of philadelphia i am grateful to steve fries for research assistance and to steven englander and comelis los for comments on an earlier draft see robert lucas 1976 william fellner s 1978 credibility hypothesis is similar to the lucas critique in this context and has been tested in similar ways 2some have argued that for political reasons by focusing on reserves the fed would be able to let interest rates go higher than under interest rate targetting with reserve targetting fed officials could shift the blame for high interest rates elsewhere

on measuring congestion of local public goods abstract using data for fire protection services this brief paper provides empirical evidence in large part demonstrating the existence of the zoo effect identified by oates the zoo effect implies an upward bias in the measurement of congestion in local public good provision resulting from the lack of a range or quality of service measure the introduction of a quality measure is found to reduce estimates of the degree of congestion in fire protection services

the phillips curve the persistence of inflation and the lucas critique evidence from exchange rate regimes comment we present evidence from the united states and the united kingdom that the persistence of price inflation is significantly higher under managed exchange rate regimes than under gold based fixed exchange rate regimes these differences are also reflected in expectations augmented phillips curves we use a two country macro model with forward looking price setters to demonstrate that higher monetary accommodation of inflation and exchange rate accommodation of inflation differentials increase inflation persistence the evidence does not contradict this hypothesis it supports the hypothesis of forward looking price setters and highlights the empirical significance of the lucas critique jel e31 e42 f33

an examination of preferences for local public sector outputs relatively unique data on the costs of public services for local governments in victoria australia are used to estimate a system of demand equations and to test alternative specifications of the underlying preferences using a translog model symmetry conditions are rejected so the data are not consistent with constrained utility maximization a nonparametric test confirms that result conditional on symmetry tests reject homogeneity and the additivity of preferences and also the separability of personal and property services copyright 1988 by mit press

per capita public expenditures and population size a non parametric analysis using french data based on the median voter model we specify a flexible general framework of the effect of municipality size on per capita public expenditures previous literature has recognized that municipality size should have a non linear effect on the quality of public goods provision and to this end different papers have applied a range of alternative parametric specifications using a very large sample of french communes we are able to estimate the effect of municipality size semi parametrically in contrast with the parametric specifications we find evidence of the u shaped relationship between per capita public expenditures and population which is predicted by theory

local public goods and private suppliers musical suburbs replayed abstract this paper deals with the existence of private market suppliers in a standard local public goods model the result of this modification can be a cycling process instigated by rich households rather than poor households the theoretical model provides empirical implications for capitalization studies and policy implications for the provision and financing of local public goods including education