Public Provision and Voluntary Contributions to Multiple Public Goods

Description

When the government is evaluating proper levels of public goods like transportation, health, and poverty relief, an important yet neglected factor is how the changes in goods affect people's contributions to other public goods. This project investigates private contributions to multiple public goods. Changes in the level of a publicly provided good change the value of other goods to consumers. Consumers' contributions to these goods will thus change. Substitutive and complementary effects among public goods are observable when the government provides a subset of public goods above the voluntary contribution level. A well known neutrality effect of government action is revisited in light of a welfare effect not seen previously. Fundamental questions such as existence, finiteness and regularity of equilibria are also examined. The aim is to analyze the effects of public goods provided by the government on people's contributions, improving adjustment in welfare policies and providing guidelines for government actions.