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1、DemandforpublicgoodsPublicchoice:theprocessthatparticipantsofthepoliticalmarketdecidealltogethercollectiveactionplansaccordingtosomerules.Theessenceishowtoinduceacollectivepreferencefromindividualpreferencesofsocialmembers.I.Preferencerevelationofpublic
2、goods1.StructureofthepoliticalmarketDemander←————→ProviderTaxpayer(Voter)←→Politician(Official)Ifeverysocialmembersharetaxationaccordingtothemarginalbenefithegainsfrompublicgoods,thenthesupplyofpublicgoodsisefficient,andthisisLindhalEquilibrium.Realizin
3、gconditionofLindhalEquilibrium:everysocialmemberiswillingtorevealhistruepreferenceofpublicgoods.Butpeopleareunwillingtorevealtheirtruepreferences.2.Approachesofpreferencerevelation(1)Speaking,advancingandretreating,voting,andrevolting.(2)Whyvote?It’sdet
4、erminedbythenetbenefitofvoting.NB=P[U(X)]-C(3)Whatvote?It’srelatedtomanyfactors,suchasincomelevel,taxationsystemandvoteform.II.Preferencesummationofpublicgoods1.VotingruleofpreferencesummationUnanimityOptimalmajoritySimplemajority2.Difficultyofpreferenc
5、esummationAccordingtotheSimpleMajorityRule,thescenariothemedianvoterprefersistheresultofthechoice.MedianVoterRole:thescenariopreferredbypeoplewhoholdneutralattitudestowardallthescenariosistheeasiestonetowin.SupposetherearethreetaxpayersR,M,P,R：Gr﹥Gm﹥GpM
6、：Gm﹥Gp﹥GrP：Gp﹥Gm﹥GrVotingresultisthatGmpreferredbyMwillwin.Conditions:single-peakedpreferenceinsteadofmultiple-peakedpreference;votingpopulationisodd;andvoteaccordingtotheSimpleMajorityRule.Votingparadox:JimA﹥B﹥CJoeB﹥C﹥ABenC﹥A﹥BIfthethreepersonsvotebetw
7、eenAandB,thenAwillbeselected;ifthethreepersonsvotebetweenBandC,thenBwillbeselected.Accordingtotheassumptionofrationalbehaviors,theoptimalscenarioshouldbeAbecauseA﹥BandB﹥CcandeduceA﹥C.Butaccordingtothemajorityvoterule,thethreepersonsvotebetweenAandC,then
8、Cwillbeselected.Arrow’sImpossibilityTheorem:it’simpossibletofindoutaselectionorderwhichdoesn’tlogicallyconflictwithindividualpreferenceunderthepremisethateverysocialmemberhashisownspecificpreferenceofpublicgoods.Thetheoremindicat
