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A Theory of Demand for Governmentally Supplied Goods and Services

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Part of the International Studies in Economics and Econometrics book series (ISEE, volume 28)

Abstract

The paper proposes a theory of demand for governmentally supplied goods and services which takes seriously the facts that there are numerous centers of power in all governments and that few of these are elected. The paper rejects the idea that the competition which exists between these centers of power is solely motivated by hubris or megalomania. It argues that the incitation to compete is furnished by the need of centers of power for the consent of citizens. Citizens, in turn, it is assumed, grant more of their consent if, at given taxprices, centers of power provide them with goods and services in quantities that more closely approach the quantities they desire. It is, therefore, intragovernmental competition which activates the mechanisms which lead citizens to reveal their nominal demands for governmentally supplied goods and services. It is the same competition, it is further argued, which explains why governmental centers of power, not only sponsor the creation of demand lobbies, but also contribute to the solution of the free-riding and shirking problems that confront these lobbies.

Keywords

Public Good Public Choice Demand Function American Economic Review Utility Loss 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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© Springer Science+Business Media New York 1993

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