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Notes on income heterogeneity and number of contributors: Public goods model
Author(s) -
Miyakoshi Tatsuyoshi,
Suzuki Kenichi
Publication year - 2018
Publication title -
pacific economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.34
H-Index - 33
eISSN - 1468-0106
pISSN - 1361-374X
DOI - 10.1111/1468-0106.12272
Subject(s) - public good , economics , cobb , nash equilibrium , microeconomics , function (biology) , mathematical economics , econometrics , genetics , evolutionary biology , biology
This paper proves that a large degree of income heterogeneity increases the number of free riders under the noncooperative Nash equilibrium of voluntary contributions to public goods with a Cobb–Douglas utility function. We prove this by investigating an algorithm structure that identifies free riders. We also support this proof by showing the numerical simulation results based on this algorithm.