Scandinavian Working Papers in Economics

Umeå Economic Studies,
Umeå University, Department of Economics

No 843: When Samuelson Met Veblen Abroad: National and Global Public Good Provision when Social Comparisons Matter

Thomas Aronsson () and Olof Johansson-Stenman ()
Additional contact information
Thomas Aronsson: Department of Economics, Umeå University, Postal: S 901 87 Umeå, Sweden
Olof Johansson-Stenman: Department of Economics, School of Business, Economics and Law, University of Gothenburg, Postal: SE – 405 30 Gothenburg, Sweden

Abstract: This paper derives Pareto efficient policy rules for the provision of national as well as global public goods in a two-country world, where each individual cares about relative consumption within as well as between countries. Furthermore, we compare these policy rules with those that follow from a non-cooperative Nash equilibrium. The results show that both global and national public goods are systematically under-provided in Nash equilibrium under such relative consumption concerns.

Keywords: Public goods; relative consumption; inter-jurisdictional comparison; status; positional goods

JEL-codes: D03; D62; H40

21 pages, August 16, 2012

Full text files 

DownloadAsset.action...Id=3&assetKey=ues843 PDF-file

Download statistics

Questions (including download problems) about the papers in this series should be directed to David Skog ()
Report other problems with accessing this service to Sune Karlsson ().

RePEc:hhs:umnees:0843This page generated on 2024-09-13 22:17:26.