You can get Tiebout by assuming different
incomes, and different tastes. In the latter
case, the tastes are for characteristics à la
Lancaster. You can get the sorting by income mentioned earlier.
Since incomes are different, you do not then have
to assume that the poor like where they live.
Choice is always the interaction of preferences and opportunities.
Thanks, Michael, for reminding me about Mishan
and Pangloss. I am flattered to be quoted in PEN-L.
At 19:41 13/04/2006, Jim Devine wrote:
Max B. Sawicky wrote:
> Like every other theorem, [Tiebout's theorem]
depends on restrictive, unrealistic assumptions that I've forgotten.<
> Contra your statement, however, everyone
doesn't necessarily want to pay the
> same for public services.
I wasn't saying that tastes don't matter. Rather, I don't think taste
differences are the main story.
> The clumping together by income does not refute Tiebout.
I wasn't trying to refute Tiebout as much as propose an alternative view.
> You could say
> their income reflects their willingness to
pay. It also minimizes their tax
> price for services. In this context, in principle anyone would want to
> exclude anybody with lesser income from their tax jurisdiction, since the
> latter would enjoy a distributional advantage in taxes-v-services. Or you
> would seek a jurisdiction where everybody was richer. As Mark Twain said,
> you wouldn't want to join a club that would have you as a member.
Max, I think we've reached a point of FUNDAMENTAL DISAGREEMENT. You're
paraphrasing Groucho Marx, not Twain.
--
Jim Devine / "There can be no real individual freedom in the presence
of economic insecurity." -- Chester Bowles
