Public Input Provision, Tax Base Mobility, and External Ownership

This article investigates the distortionary impacts of tax base mobility and external ownership on public input provision. Regional governments compete for mobile tax bases (e.g., business capital). The impact of regional public policy partially accrues to non-residents because immobile factors (e.g., business land) are subject to external ownership. This article derives an optimal rule for regional public input provision that illustrates how these two distortionary impacts depend on the nature of production functions. The impact of external ownership is particularly complex. To explore this impact in detail, the case of production functions with constant elasticity of substitution is examined. Public inputs with different productivity impacts yield fairly different implications of external ownership for inefficient public input provision.

The representation of public values in health technology assessment to inform funding decisions: the case of Australia's national funding bodies

Over the past few years, there has been an increasing recognition of the value of public involvement in health technology assessment (HTA) to ensure the legitimacy and fairness of public funding decisions [Street J, Stafinski T, Lopes E, Menon D. Defining the role of the public in Health Technology Assessment (HTA) and HTA-informed decision-making processes. Int J Technol Assess Health Care. 2020;36:87–95]. However, important challenges remain, in particular, how to reorient HTA to reflect public priorities. In a recent international survey of thirty HTA agencies conducted by the International Network of Agencies for HTA (INAHTA), public engagement in HTA was listed as one of the “Top 10” challenges for HTA agencies [O'Rourke B, Werko SS, Merlin T, Huang LY, Schuller T. The “Top 10” challenges for health technology assessment: INAHTA viewpoint. Int J Technol Assess. 2020;36:1–4]. Historically, Australia has been at the forefront of the application of HTA for assessing the effectiveness and cost-effectiveness of new health technologies to inform public funding decisions. However, current HTA processes in Australia lack meaningful public inputs. Using Australia as an example, we describe this important limitation and discuss the potential impact of this gap on the health system and future directions.

A driver or a placebo? The role of financial support in farmer cooperative development in China

PurposeThis paper explores the effect of financial support on farmer cooperative development in the Chinese context, aiming to evaluate the effectiveness of public inputs and draw implications for the sustainable development of cooperatives. The variance of the effect in different sectors, i.e. crop, forestry, husbandry, fishery and services, is investigated.Design/methodology/approachProvincial-level panel data from 2007 to 2017 are used for this study. A linear dynamic panel regression model is estimated using multiple estimation methods, i.e. the generalized method of moments (GMMs), fixed-effect model and ordinary least squares (OLS) are applied.FindingsThe empirical analyses indicate that the role of the government is important for the development of farmer cooperatives but limited in some specific aspects. First, the coverage of financial support is positively associated with the growth of cooperative population and membership size, but the strength of financial support, measured by the total amount of financial support divided by local agricultural gross domestic product (GDP), has no statistically significant effects on the development of cooperatives. Second, financial support does not exhibit significant influence on the revenue of cooperatives. Third, the magnitude of the effect of government support on cooperative development is heterogeneous across different sectors.Originality/valueThe research study adds to the institutional economics literature on the association between institutional environment and organization development by focusing on a particular and an important type of organization, i.e. farmer cooperatives. It is one of the attempts and a most extensive study to empirically investigate the role of financial support in the development of farmer cooperatives.

The ‘Rights’ Way to Democratize the Science–Policy Interface in International Environmental Law? A Reply to Anna-Maria Hubert

Science is widely regarded as being necessary for effective international environmental decision-making and risk assessment processes. However, it is equally well recognized that uncertainties or the complexity of phenomena under study mean that science may only offer partial knowledge for environmental problems in many circumstances. ‘Democratization’ of science is often proposed as a solution to this dilemma. This may involve incorporating a wider spectrum of expert views and public inputs in risk assessments of new technologies, public participation in science through so-called ‘citizen science’ initiatives or the application of the precautionary principle. This reply reviews these approaches and contrasts them with another tantalizing possibility offered by Anna-Maria Hubert’s article; a human rights-based approach drawing on the ‘oft-neglected’ right to science. It assesses the extent to which a rights-based approach, utilizing the right to science, offers a way to bridge the gap between science and democracy in contested international environmental legal decision-making processes. While it concludes that there are important potential benefits to the application of the right to science in international environmental law, it is far from clear that it provides a panacea given the limitations on the right expressed in the international human rights instruments in which it is found, such as the International Covenant on Economic, Social and Cultural Rights. Instead, the right to science can be seen as placing another thumb on the scales – alongside the precautionary and participatory approaches – in favour of enabling broader, more democratically accountable decision-making in cases of uncertain science and contested environmental risks.

Public Input Provision in Asymmetric Regions with Labor Market Imperfections

This paper examines efficiency in public input provision in two large regions with labor market imperfections. Because employment and pecuniary externalities are associated with public input provision, the provision level exceeds the optimal amount under the presence of wage rigidities in the capital-exporting jurisdiction if only head taxes are used to finance government expenditures. Efficiency in public input provision will remain ambiguous in the capital-importing jurisdiction unless a specific functional form is assumed for the production technology. The constrained efficient provision with public inputs can be restored with an additional tax (subsidy) on capital that is used to strategically influence the interest rate on the common capital market and to increase employment by attracting foreign capital.

Localized prosocial preferences, public goods, and common-pool resources

The presence of prosocial preferences is thought to reduce significantly the difficulty of solving societal collective action problems such as providing public goods (or reducing public bads). However, prosociality is often limited to members of an in-group. We present a general theoretical model where society is split into subgroups and people care more about the welfare of others in their own subgroup than they do about those in out-groups. Individual contributions to the public good spill over and benefit members in each group to different degrees. We then consider special cases of our general model under which we can examine the consequences of localized prosociality for the economic outcomes of society as a whole. We ask to what extent prosociality closes the welfare gap between the Nash equilibrium without prosociality and the social optimum. The answer depends on whether private and public inputs are good or poor substitutes in producing final output. Critically, the degree to which this welfare gap closes is a concave function of the level of prosociality in the case of poor substitutes, so even low levels of prosociality can lead to social welfare near the social optimum.

Solar Geoengineering Governance

Climate engineering, a set of techniques proposed to intervene directly in the climate system to reduce risks from climate change, presents many novel governance challenges. Solar radiation management (SRM), particularly the use of stratospheric aerosol injection (SAI), is one of the most discussed proposals. It has been attracting more and more interest, and its pertinence as a potential option for responding to the threats from climate change may be set to increase because of the long-term temperature goal (well below 2°C or 1.5°C) in the 2015 Paris Agreement. Initial research has demonstrated that SAI would cool the climate system and reduce climate risks in many ways, although it is mired in unknown environmental risks and various sociopolitical ramifications. The proposed techniques are in the early stage of research and development (R&D), providing a unique opportunity for upstream public engagement, long touted as a desirable pathway to more plural and inclusive governance of emergent technologies by opening up social choices in technology. Solar geoengineering governance faces various challenges. One of the most acute of these is how to situate public engagement in international governance discourse; the two topics have been studied separately. Another challenge relates to bridging the gap between the social choices at hand and assessment of the risks and benefits of SRM. Deeper integration of knowledge across disciplines and stakeholder and public inputs is a prerequisite for enabling responsible innovation for the future of our climate.