Testing the democratic hypothesis in the provision of local public goods

Abstract

The financing of local public goods in French communities can be viewed, until 1980, as a one-dimensional choice. We propose a model to formalize this choice which results in the best choice of the 'median' agent in a population in which two types of citizens have been distinguished. A translog specification is estimated on 36 communities near the city of Toulouse, France. The democratic hypothesis according to which both types of agents have the same weight in the decision process is rejected. Moreover, we do not reject the hypothesis that this bias decreases with the size of the city.

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