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Share equilibrium in local public good economies

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Article
Author/s: 
Myrna Wooders and Anne van den Nouweland
Journal of Mathematical Economics
Issue number: 
3
Publisher: 
Elsevier
Year: 
2011
Journal pages: 
376–381
We define a concept of share equilibrium for local public good (or club) economies where individual members of the population may have preferences over the membership of their jurisdiction. A share equilibrium specifies one share index for each individual. These indices determine each individual’s cost shares in any jurisdiction that he might join. We demonstrate that the same axioms as those that characterize the Lindahl equilibrium, as discussed in Lindahl’s 1919 paper, also characterize the share equilibrium. Share equilibrium extends the notions of ratio equilibrium and cost share equilibrium (due to 0020 and 0035) to economies with a local public good and possibly multiple jurisdictions.
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