The Design of Transnational Public Good Mechanisms for Developing Countries

Posted: 10 Jun 2005

See all articles by Jean-Jacques Laffont

Jean-Jacques Laffont

University of Southern California - Department of Economics (Deceased)

David Martimort

University of Toulouse 1 - Industrial Economic Institute (IDEI); CESifo (Center for Economic Studies and Ifo Institute)

Abstract

We analyze the design of incentive mechanisms for the provision of transnational public goods under asymmetric information. Transnational public goods are infrastructures that no single country can afford to build for itself. We show that the external constraints imposed by this mechanism may affect consumption, pricing and the true redistributive concerns of local governments. We characterize the corresponding distortions. We also discuss the impact of the preferences for redistribution of the international agency in charge of designing the mechanism and the role of its ability to enforce that mechanism.

Keywords: Transnational public goods, incentive mechanisms

JEL Classification: H41, D82

Suggested Citation

Laffont, Jean-Jacques and Martimort, David, The Design of Transnational Public Good Mechanisms for Developing Countries. Journal of Public Economics, Vol. 89, No. 2-3, February 2005. Available at SSRN: https://ssrn.com/abstract=740290

Jean-Jacques Laffont

University of Southern California - Department of Economics (Deceased)

No Address Available

David Martimort (Contact Author)

University of Toulouse 1 - Industrial Economic Institute (IDEI) ( email )

Manufacture des Tabacs
21 Allee de Brienne bat. F
Toulouse Cedex, F-31000
France
+33 5 6112 8614 (Phone)
+33 5 6112 8637 (Fax)

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

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