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Multi‐region Development and Fiscal Equity
Publication year - 1983
Publication title -
american journal of economics and sociology
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.199
H-Index - 38
eISSN - 1536-7150
pISSN - 0002-9246
DOI - 10.1111/j.1536-7150.1983.tb01717.x
Subject(s) - economics , marginal product , population , equity (law) , productivity , immigration , argument (complex analysis) , value (mathematics) , natural resource economics , economy , production (economics) , microeconomics , macroeconomics , geography , demography , archaeology , sociology , political science , computer science , law , machine learning , biochemistry , chemistry
A bstract . If a region has a fixed resource base (say land) then adding labor eventually results in a declining marginal product per worker. If there is a pure Samuelsonian public good in the region, more people permit the spreading of the tax burden for producing the public good at no cost in terms of crowding the good. Thus we have an essential trade‐off between the declining marginal productivity of an immigrant to a region and his positive fiscal “value.” This trade‐off was highlighted by Flatters, Henderson and Mieszkowski 1 and an optimal population was arrived at for a single region economy. We extend this optimal population argument to a multi‐region economy and observe two phenomena.