Justifying the Lindahl Solution as an Outcome of Fair cooperation

DOI to cite this document:: 10.5283/epub.5125

Buchholz, Wolfgang ; Peters, Wolfgang

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Date of publication of this fulltext: 05 Aug 2009 13:49

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Abstract

The motivation for the Lindahl equilibrium is mostly a rather artificial price mechanism. Even though the analogy to a competitive market was emphasised by Lindahl himself, his approach does not directly explain the normative ideas behind his concept. In the present paper we therefore show how the Lindahl equilibrium can be deduced from some simple equity axioms. These normative assumptions are ...