Provision Of Public Goods Research Articles

Segregation and the Spatial Externalities of Inequality: A Theory of Interdependence and Public Goods in Cities

Conventional wisdom claims that racial diversity undermines public goods provision. I show that class-based differences, instead, incentivize cooperation for public goods. Class-based segregation reduces spatial externalities of inequality (e.g., sewage pollution and crime) spilling over from impoverished areas (e.g., slums) to the middle class. Conversely, I argue that in integrated (de-segregated) cities, the scale of such externalities undermines the efficacy of private services (e.g., private security), thereby inducing middle-class preferences for externalities-correcting public goods. Thus, while segregation polarizes preferences, integration aligns the middle class with the poor in coalitions that support public goods over private alternatives. I illustrate the theory using focus groups, a proposed quasi-experimental strategy, and an original face-to-face survey of 4,208 households across 420 neighborhoods in São Paulo, Brazil. The analysis introduces self-interest in reducing intergroup externalities as a mechanism for cooperation for public goods even in diverse societies. Using mechanism vignettes, I distinguish the mechanism from the affective attitudes—racial tolerance, social affinity—of intergroup contact.

Ethnically asymmetric political representation and the provision of public goods: theory and evidence from Ethiopia

Ethnically asymmetric political representation and the provision of public goods: theory and evidence from Ethiopia

Disaggregated Impact of Government Expenditure on Economic Growth: Evidence from Nigeria

The quest to accelerate the pace of development of the economy in a bid to transform Nigeria into the group of developed economies by achieving certain macroeconomic objectives had called for increasing government expenditure in the provisions of public goods for the people and the nation. In view of the role of public expenditures on national progress and prosperity, this study empirically examined the disaggregated impact of the expenditures on economic growth in Nigeria for the period 1986-2021 using ARDL model as a tool for analysis. The important findings from the study suggest that capital and recurrent expenditures on community, social and economic services significantly boost economic growth in both short and long runs but the recurrent expenditure is negatively significant in the short run. Similarly, recurrent expenditure on community, social and economic services is also positively and significantly related with real GDP. Although capital and recurrent expenditures on administration and transfer are found to retard economic growth in the short run; they turn out to significantly enhance national output in the long run. Other findings from the study revealed that capital stock significantly promotes growth whereas labour slows down the growth across both short and long runs. The study recommends that government should lay a solid foundation and provide a workable business ground for individuals and firms. Government should also pay attention to finance growth enhancing spending categories such as infrastructure, research and development, education and health that would enhance human development in the country.

Debunking the autocratic fallacy? Improving public goods delivery in Russia

AbstractRussia's invasion of Ukraine has not only deeply challenged Russia's international standing but has also endangered its fragile domestic order. Data from the 2022 Berggruen Governance Index reveals that overall state capacity has been stagnating at a fairly low level since the beginning of the millennium, while democratic accountability has been declining steadily and profoundly. In contrast, the provision of public goods has strongly increased during the same period. This puts the assumption of the ‘autocratic fallacy’—the idea that sustained public goods delivery relies on democratic accountability in the long run—to the test. We argue that Russia's resource abundance allowed for the maintenance of a regime‐supporting social contract with the population. However, the basis of that contract has changed significantly due to economic decline, fired by, among other factors, several waves of sanctions and the costs of war and will press the Russian government to find urgent solutions to sustain a high level of public goods provision under such unfavourable conditions.

Introducing the Berggruen Governance Index I: Conceptual and methodological framework

AbstractGovernance is at the heart of how well governments meet public needs and manage a wide array of common problems. Why do some countries perform poorly in delivering healthcare, reducing inequality, providing a clean environment or delivering some other public good to their populations even while they have the resources to do so? Does the capacity of states to provide the basics for societies to thrive depend on forms of democratic accountability that represents different interests, or are systems under technocratic control that impose solutions and disregard, even suppress, many voices better at meeting public needs? Existing indices do not systematically examine the relationship between the components that contribute to governance performance. In our understanding of governance, depicted as the Governance Triangle, public goods provision is a function of state capacity and accountability. Rather than focusing on a single composite performance measure, the Berggruen Governance Index examines the interactions among these dimensions. We find that the key to good governance is achieving a balance among the three dimensions on an upward and sustainable trajectory. This article introduces the Index and the conceptual and methodological framework that underpins it and then outlines the content of this special issue.

A falling star? Origins of declining state capacity and democratic accountability in the United States

AbstractThe United States—often hailed as the ‘oldest democracy in the world’ and the ‘leader of the free world’—has fallen on hard times. In addition to recent headline‐grabbing political events that have highlighted its political dysfunction, data from the 2022 Berggruen Governance Index (BGI) reveal that overall state capacity and democratic accountability have been declining for years. Although public goods provision has remained on a steady course, the US still trails much of the developed world. We find this struggling performance is largely the result of neglecting three types of infrastructure: civic, physical and social. Specifically, we argue that the crisis became particularly pronounced due to an insufficient response to the 2008 global financial crisis. Although some recent political achievements could slow the decline, more drastic action will be required to reverse these troubling trends.

Collective minimum contributions to counteract the ratchet effect in the voluntary provision of public goods

We experimentally test a theoretically promising amendment to the ratchet-up mechanism of the Paris Agreement. The ratchet-up mechanism prescribes that parties’ commitments to the global response to climate change cannot decrease over time, and our results show that its effect is detrimental. We design a public goods game to study whether cooperation is promoted by an amendment to the mechanism that stipulates that all agents must contribute at least a collectively chosen minimum based on the principle of the lowest common denominator. We find that binding collective minimum contributions improve the effectiveness of the ratchet-up mechanism. Non-binding minimum contributions, by contrast, do not encourage cooperation. Our data indicate that the difference is attributable to conditional cooperative dynamics. If other participants contribute less than the collective minimum contribution, even initially cooperative participants start to negatively reciprocate this form of non-compliance by contributing less.

Unfinished revolutions: The post‐Soviet crisis of governance in Ukraine

AbstractNone of the three revolutions in Ukraine's modern history as an independent state has been able to both solve the problem of political representation and undertake the task of building sustainable democratic institutions. Ukraine's scores from the Berggruen Governance Index (BGI) between 2000 and 2019 show the ups and downs of state capacity and democratic accountability and illustrate not only how the revolutions remain unfinished but also how the country seems to be unable to consistently advance state formation. Ukraine has yet to find a stable developmental path. Accordingly, BGI scores show that Ukrainian politics and society continue to have difficulty advancing towards a corridor of good governance, where state capacity and accountability reinforce each other and enhance public goods provision. Instead, Ukraine is alternating between authoritarian and democratic development patterns. However, the Russian invasion that began on 24 February 2022 has contributed to uniting and consolidating Ukrainian society and politics and could considerably push the nation‐building process forward.

Sub‐Saharan Africa: Towards better governance and sustainability?

AbstractThe countries of the Sub‐Saharan region have, on average, made significant progress in governance performance, especially in terms of democratic accountability and public goods provision—findings that seem to contradict patterns of state fragility and economic underdevelopment common in the region. This article explores this seeming contradiction and presents in more detail findings from the Berggruen Governance Index regarding the governance performance of five countries, namely Ghana, Kenya, Nigeria, Senegal and South Africa. Lagging state capacity and growing sovereign debt emerge as critical factors, and the article suggests that they may be responsible for the inability of many countries in the region to consolidate gains in governance as well as economic performance.

Lessons and challenges of China's state‐led and party‐dominated governance model

AbstractThe case of China gets at one of the core questions that the Berggruen Governance Index (BGI) poses—can we necessarily assume that democratic accountability makes for better governance performance? China has steadily improved in public goods and state capacity according to the BGI data from 2000 and 2019, especially in terms of economic public goods and fiscal capacity due to its rapid GDP growth under an investment‐led growth model. However, China's democratic accountability has worsened, presenting an uncommon case of improved governance performance. Now China's economy stands at a crossroads amid the precedent‐breaking leadership of Xi Jinping. Will China disprove the ‘autocratic fallacy,’ whereby a dominant state setting priorities and making decisions for a society is sufficient? To what extent can China improve public goods provision and expand state capacity while limiting voice processes? This article examines key policies and strategies of China's governance performance over the past two decades. It also identifies future challenges underlying China's party‐dominated and whole‐of‐nation approach to governance and its investment‐led and export‐oriented development model.

The Economic Origins of Government

We test between cooperative and extractive theories of the origins of government. We use river shifts in southern Iraq as a natural experiment, in a new archeological panel dataset. A shift away creates a local demand for a government to coordinate because private river irrigation needs to be replaced with public canals. It disincentivizes local extraction as land is no longer productive without irrigation. Consistent with a cooperative theory of government, a river shift away led to state formation, canal construction, and the payment of tribute. We argue that the first governments coordinated between extended households which implemented public good provision. (JEL D72, H11, H41, N45, N55, Q15)

Electoral rule and public sector efficiency: Some evidence from Italian municipalities

AbstractWe study the effect of Law 81/1993, which introduced a different rule for the election of mayors, on the technical efficiency of Italian cities over the period 1998–2006. Since 1993, municipalities below 15,000 inhabitants vote with a single‐ballot system, whereas cities above 15,000 inhabitants are subject to a double ballot. We first estimate the output‐oriented technical efficiency of municipalities through data envelopment analysis, and then we perform a regression discontinuity design analysis by exploiting the exogenous change in the electoral scheme at the 15,000 inhabitants cut‐off. We find evidence that municipalities voting under a double‐ballot rule show lower levels of efficiency—in terms of provision of public goods—compared with cities voting under a single‐ballot scheme, by about 6.5%. This effect is driven by inefficiencies registered in specific sectors, that is, police, education, and maintenance of roads. Furthermore, the overall lower efficiency of municipalities voting under runoff is related to the different level of educational attainment of elected mayors, whereas it is not driven by the features of Law 81/1993 relating to the number of lists forming a coalition in support of mayoral candidates and to disjoint votes.

Undermining U.S. reputation: Chinese vaccines and aid and the alternative provision of public goods during COVID-19

Undermining U.S. reputation: Chinese vaccines and aid and the alternative provision of public goods during COVID-19

Does natural resource hinder, taxation capacity and accountability? A case of selected oil abundant developing countries

This study aims to explore the mechanism that corroborates the political-economy explanation of the resource curse in oil rich developing countries. This mechanism elucidates that increasing resource rents provides higher incentives for leaders to remain in power, through a deliberate refusal to improve taxation capacity, which would, in turn, reduce the tax burden on its citizens to reduce their demand for accountability. Using a panel data set for 25 oil producing developing countries for the period 1996–2011, the study demonstrated that oil abundant developing countries lack adequate taxation capacity which influences fiscal contract through taxation of the citizens and minimises the scrutiny of government and the demand for accountability. In turn, the economy is plagued by inadequate provision of public goods and a limited means to raise revenue to finance government expenditure. The empirical analysis supports this mechanism. To this regard, it concludes that the presence of oil in the selected countries can undermine accountability.

When tainted money should fund public goods: fundraising professional and public moral preferences.

Philanthropy is essential to public goods such as education and research, arts and culture, and the provision of services to those in need. Providers of public goods commonly struggle with the dilemma of whether to accept donations from morally tainted donors. Ethicists also disagree on how to manage tainted donations. Forgoing such donations reduces opportunities for societal well-being and advancement; however, accepting them can damage institutional and individual reputations. Half of professional fundraisers have faced tainted donors, but only around a third of their institutions had relevant policies (n = 52). Here, we draw on two large samples of US laypeople (ns = 2,019; 2,566) and a unique sample of experts (professional fundraisers, n = 694) to provide empirical insights into various aspects of tainted donations that affect moral acceptability: the nature of the moral taint (criminal or morally ambiguous behavior), donation size, anonymity, and institution type. We find interesting patterns of convergence (rejecting criminal donations), divergence (professionals' aversion to large tainted donations), and indifference (marginal role of anonymity) across the samples. Laypeople also applied slightly higher standards to universities and museums than to charities. Our results provide evidence of how complex moral trade-offs are resolved differentially, and can thus motivate and inform policy development for institutions dealing with controversial donors.

Reconfiguring essential and discretionary public goods

Abstract When is state coercion for the provision of public goods justified? And how should the social surplus of public goods be distributed? Philosophers approach these questions by distinguishing between essential and discretionary public goods. This article explains the intractability of this distinction, and presents two upshots. First, if governments provide configurations of public goods that simultaneously serve essential and discretionary purposes, the scope for justifiable complaints by honest holdouts is narrower than commonly assumed. Second, however, claims to distributive fairness in the provision of public goods also turn out to be more complex to assess.

Water clubs: a new model for managing freshwater in small catchments *

Over the past 30 years market-based mechanisms have been upheld as the gold-standard of water governance approaches. However, while some water markets have been successful, many struggle to meet the strict institutional preconditions for efficiency and effectiveness, which has implications for social welfare and public good provision. As pressures on water resources increase, there is a growing need to consider alternative market designs that foster more cooperation between water users. Drawing on club theory and game theory, this paper investigates the economic and environmental benefits of (re)designing water markets as clubs. It finds that in small catchments, the introduction of group-level trading can increase provision of the public good, improve social welfare, and reduce free-riding when compared with a regulatory status quo. It also finds that the club model performs best when the number of active traders is low—a result that challenges the common assumption regarding group size and effective market performance. In local contexts, the group-level trading may also help characterise the optimal group size by weighing the benefits from more trading opportunities against the losses from free-riding.

Analisis Kebijakan Pengelolaan Keuangan Sektor Publik dalam Mewujudkan Good Governance di Pemerintah Kota Gresik

Gresik City is a city that is experiencing very rapid economic growth on the basis of the dynamics of capital circulation in the economic market and political mainstream. The process of implementing state power in carrying out the provision of public goods and services is part of good governance. In order for Good Governance to be successful, it requires commitment from all parties, namely the government and society. Therefore this study aims to determine the management of the public sector in realizing Good Government in the Gresik City area. The method used in this research is descriptive qualitative. The data used in writing is qualitative data, namely data in the form of information or explanations from authorized parties such as decisions of the directors, a brief history of the company, organizational structure and description of their duties, and other data relevant to the object of writing. The results of the research show that the regional government of Gresik has implemented the principles of good governance, although not optimal. This can be seen from the existence of legal supremacy, the ease of accessing information, the efforts to provide good service to the community, and being accountable for all its performance.

Electoral competition, district party fragmentation and environmental policy outcome: Empirical evidence from Indonesia

This paper explores how party fragmentation and electoral competition relate to the outcome of environmental policy. It is assumed that when elections happen the electoral punishment and incentives will be distributed. Specifically, when there are high number of effective number parties (ENP) in the legislature, it brings competition to the incumbent to provide more public goods. Hence, the electoral competition and party fragmentation will bring more provision of public goods. Using these assumptions, the electoral competition theory provides basic pieces of information to predict the effect of electoral competition on environmental policy outcome; a high ENP will provide a better outcome of environmental policy. Taking Indonesia as our case selection, we discovered a positive association between the number of effective parties and energy efficiency, such as LED, and a negative correlation between the usage of wood for domestic fuel. This means that political competition such as electoral competition promotes better outcome for environmental policy.

Indirect rule and public goods provision: evidence from colonial India

AbstractThis paper contributes to the conflicting literature about indirect rule by delivering a new theoretical explanation for the persistent effects of indirect rule on contemporary provision of public goods. It looks at a single region of India which has areas that historically experienced both direct and indirect rule. The theoretical mechanism focuses on the principal-agent problem and the incentives that it produces for local leaders. Unlike local princes, colonizers were under stricter oversight and had to be more accountable to the top due to the obligations to extract resources. A spatial regression discontinuity design is used to compare directly and indirectly ruled territories. The empirical results show that indirect rule has predominantly long-term negative effects on the provision of selected public goods.