Scandinavian Working Papers in Economics

Memorandum,
Oslo University, Department of Economics

No 03/2003: Optimal Provision of Public Goods with Rank Dependent Expected Utility.

Erling Eide ()
Additional contact information
Erling Eide: Department of Private Law, Postal: Department of Private Law, Postbox 6706, St. Olavs plass, 0130 Oslo, http://www.jus.uio.no/ifp/english/index.html

Abstract: In this paper the theory of rank-dependent expected utility (RDEU) is substituted for the theory of expected utility (EU) in a model of optimal provision of public goods. The substitution generalizes the Samuelson rule, previously modified to include deadweight loss and tax evasion loss.

Keywords: Tax evasion; optimal taxation; rank dependent expected utility

JEL-codes: D81; H21; H26

22 pages, October 12, 2002

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