Akihiko Yanase, Faculty of Economics, Takasaki City University of Economics, 1300 Kaminamie, Takasaki 370-0801 Japan (firstname.lastname@example.org).
Dynamic Voluntary Provision of Public Goods and Optimal Steady-State Subsidies
Version of Record online: 10 FEB 2006
Journal of Public Economic Theory
Volume 8, Issue 1, pages 171–179, January 2006
How to Cite
YANASE, A. (2006), Dynamic Voluntary Provision of Public Goods and Optimal Steady-State Subsidies. Journal of Public Economic Theory, 8: 171–179. doi: 10.1111/j.1467-9779.2006.00258.x
- Issue online: 10 FEB 2006
- Version of Record online: 10 FEB 2006
- Received October 15, 2003; Accepted July 20, 2004.
This paper examines a differential game model of voluntary provision of a public good in which private agents' contributions accumulate over time and derives subsidy rules that achieve the socially efficient steady state. It is shown that the optimal subsidy rule is a simple one when agents use the open-loop strategy, while under Markovian strategies it intricately depends on the parameters of the economy.