The Bulletin of the Center for Research on Regional Economic Systems, the Graduate School of Social Science, Hiroshima University Issue 29
2018-03 発行


Reexamining the Relationship between the Spillover Effects of Local Public Goods and Optimal Revenue-Matching Grant Rates
Yang, Tong
The conventional model indicates a relationship between the degrees of spillover arising from local public goods and the optimal revenue-matching grant rates from central government to local government. In the model, an increase in local public goods only impacts utilities. Therefore, we expand the model in this paper to include general public goods, general public capital, and public goods with the characteristics of local public capital. We examine the relationship between the degree of spillover effect and the optimal revenue-matching grant rates, and consider the external effect of both consumption and production. Thus, we obtain a more generalized conclusion and provide a new perspective.
Local public goods
Optimal revenue matching grant rates