Some Use of Expenditure Function in Public Finance英文文献资料

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1、JournalofPublicEconomics5(1976)373-379.0North-HollandPublishingCompanySOMEUSESOFTHEEXPENDITUREFUNCTIONINPUBLICFINANCEAcommentWilliamG.MOSS*UniversityofCalifornia,Davis,CA95616,U.S.A.ReceivedDecember1974,revisedversionreceivedMarch1975Thepurposeofthisnoteistocorre

2、ctanerrorinthepresentationbyProfessorsDiamondandMcFaddenoftheapplicationoftheexpenditurefunctiontotheanalysisoflumpypublicinvestments.Indevelopingtheirinvestmentcriteriatheauthorsattempttopresentthesameinvestmentcriteriontwoways:oneemphasizesthepricevectorsandthe

3、otheremphasizesnonnumerairequantityvectorsbeforeandaftertheproject.However,becauseofanerrorinintegrationtheyactuallypresenttwodifferentinvestmentcriteria.InthisnoteitisshownthatthetwocriteriacorrespondtoHickscompensatingvariationandcompensatingsurplusconceptsofco

4、nsumersurplusorbenefits.1.IntroductionInarecentissueofthisJournalProfessorsDiamondandMcFadden(D-M)showtheusefulnessoftheexpenditurefunctioninanalyzingcertainproblemsinpublicfinance.Inparticulartheydemonstrateitsusefulnessinthestudyofthedeadweightburdenoftaxation,

5、optimalcommoditytaxes,andcriteriaforindivisiblepublicinvestmentfinancedbylumpsumtaxation.Thepurposeofthisnoteistocorrectanerrorintheirpresentationoftheapplicationoftheexpenditurefunctiontotheanalysisoflumpypublicinvest-ments.Indevelopingtheirinvestmentcriterion,t

6、heauthorsattempttopresentthiscriterionintwoways;oneemphasizesthepricevectorsandtheotheremphasizesnonnumerairequantityvectorsbeforeandaftertheproject.Howeverbecauseofanerrorinintegration,theyactuallypresenttwodifferentinvestmentcriteria.InthisnoteIshowthatbothinve

7、stmentcriteriaarevalidandcorrespondtotheuseoftwowell-knowndefinitionsofbenefits.Theyarethecompensatingvariationandthecompensatingsurplusconceptsofconsumersurplusorbenefits[Hicks(1956,pp.95-loo)].Itisusefultohavethetwocriteriabecauseforsomeprojectsitiseasiertofore

8、castprices,whileforothersitiseasiertoforecast*IhavebenefitedfromcommentsandencouragementbyP.A.Diamond.However,anyerrorsaremyown.374W.G.Moss,Theexpenditureficti