Why is it difficult to empirically determine the degree to which government spending crowds out private provision of public goods?
Answer to relevant QuestionsThink back to Chapter 5. Why can the public good provision problem be thought of as an externality problem? Consider an economy with three types of individuals, differing only with respect to their preferences for monuments. Individuals of the first type get a fixed benefit of 100 from the mere existence of monuments, whatever ...Suppose you prefer working 40 hours per week to 20 hours, and prefer working 32hours per week to either 20 or 40 hours. However, you are forced to work either 20hours or 40 hours per week. Is your hourly wage rate an ...Imagine you are the governor of Massachusetts 15 years ago and need to decide if you should support the “Big Dig” highway and bridge construction project. The Big Dig is estimated to take seven years to complete. The ...Figlio (1999) found that legislators are more likely to mirror their constituents’ preferences during election years than in earlier years of their terms. This is particularly true for relatively inexperienced legislators. ...
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