Journal of Public Economic Theory 

About: Journal of Public Economic Theory is an academic journal published by Wiley-Blackwell. The journal publishes majorly in the area(s): Public good & Indirect tax. It has an ISSN identifier of 1097-3923. Over the lifetime, 1081 publications have been published receiving 16337 citations.

Choosing What to Protect: Strategic Defensive Allocation against an Unknown Attacker

Abstract: We study a strategic model in which a defender must allocate defensive resources to a collection of locations and an attacker must choose a location to attack. In equilibrium, the defender sometimes optimally leaves a location undefended and sometimes prefers a higher vulnerability at a particular location even if a lower risk could be achieved at zero cost. The defender prefers to allocate resources in a centralized (rather than decentralized) manner, the optimal allocation of resources can be non-monotonic in the value of the attacker's outside option, and the defender prefers her defensive allocation to be public rather than secret. Copyright 2007 Blackwell Publishing, Inc..

GHG Targets as Insurance Against Catastrophic Climate Damages

Abstract: A critical issue in climate change economics is the specification of the so-called “damages function” and its interaction with the unknown uncertainty of catastrophic outcomes. This paper asks how much we might be misled by our economic assessment of climate change when we employ a conventional quadratic damages function and/or a thin-tailed probability distribution for extreme temperatures. The paper gives some numerical examples of the indirect value of various greenhouse gas (GHG) concentration targets as insurance against catastrophic climate change temperatures and damages. These numerical exercises suggest that we might be underestimating considerably the welfare losses from uncertainty by using a quadratic damages function and/or a thin-tailed temperature distribution. In these examples, the primary reason for keeping GHG levels down is to insure against high-temperature catastrophic climate risks.

Leadership Giving in Charitable Fund-Raising

Abstract: Why do charities often begin new capital fund drives by announcing a large contribution by a single wealthy donor? This paper explores the possibility that such “leadership giving” provides a signal to all other givers that the charity is of high quality The dilemma is that if the lead giver can deceive others to believe the charity is of higher quality than it truly is, then these followers will make larger contributions, which will benefi tt he leader Hence, the leader must give an unusually large amount to convey a credible signal of the quality This sets up a war-of-attrition game for who will pay the cost to signal the quality Since the wealthy have the lowest opportunity cost of providing the signal, they, in equilibrium, move first to provide the signal of quality with exceptionally large gifts

School Finance Induced Migration and Stratification Patterns: The Impact of Private School Vouchers

Abstract: This paper introduces a general equilibrium model of public school finance that includes: (i) multiple school districts that finance local public schools via property taxes set by majority vote; (ii) multiple neighborhoods within school districts where each neighborhood is characterized by a quality level of housing; (iii) local public schools that are obligated to admit all interested students who reside within the school district; (iv) private schools that function as clubs of parents who share the cost of the private school equally and who can choose to exclude others; (v) an educational production process that depends on both per pupil spending and average peer quality within the school; and (vi) individual peer quality levels that are correlated with the socioeconomic status of households. Since it allows for various degrees of imperfect stratification of residents across communities, the model is well suited for investigating empirically relevant migration forces induced by school finance reform proposals. The abstract model itself, however, is too complex to yield many analytic results. A computational counterpart to the model isnb therefore developed, calibrated to data, and utilized for policy experiments. In particular, the impact of vouchers in the context of different types of prevoucher educational finance systems is investigated, and it is found that migration patterns in general would cause vouchers to benefit public schools in poor communities while hurting public schools in wealthy communities.

Tax competition and economic geography

Abstract: Tax competition between two countries is considered in a trade- and-location setting with differentiated products and monopolistic competition. There are two groups of workers, mobile ones and immobile ones. Taxes are used for producing a public good. It is shown that an equilibrium with mobile workers dispersed across countries is destabilised by increased taxes on these mobile workers|and this is shown to be true also for perfectly coordinated tax increases. It is also shown that an agglomeration is taxable, and that increasing public spending may relax the minimum tax pressure on immobile workers consistent with preserv-ing an agglomeration.