In praise of inequality: income distribution and the private provision of public goods
de Meza, D.
, Itaya, J. & Myles, G. D.
(1997).
In praise of inequality: income distribution and the private provision of public goods.
Economics Letters,
57(3), 289-296.
https://doi.org/10.1016/S0165-1765(97)00179-1
, Itaya, J. & Myles, G. D.
(1997).
In praise of inequality: income distribution and the private provision of public goods.
Economics Letters,
57(3), 289-296.
https://doi.org/10.1016/S0165-1765(97)00179-1
It is shown that if all individuals contribute towards the provision of a public good their utilities are equalised even if the income distribution is unequal. It may seem that there is then no role for redistributive policy, but it is proved that social welfare can be raised by creating sufficient income inequality that only the rich provide public goods.