Consider Voter Preferences Over a Public Good Y That Is

question 3

Essay

Consider voter preferences over a public good y that is being funded by a proportional income tax.
a.Illustrate how this might lead to single peaked voter preferences.
b.Suppose there exists a privately available good x that is substitute for y.How does this introduce non-single peakedness?
c.Now suppose x is relatively complementary to y.What would you expect to happen to voter preferences as this complementarity gets stronger?

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Definitions:

Diseconomies of Scope

A situation in which a single firm producing multiple products has higher costs than if each product were produced by a separate firm.

Economies of Scale

The cost advantages that enterprises obtain due to their scale of operation, which often leads to a reduction in average cost per unit as scale is increased.

Economies of Scope

Cost advantages that a business experiences by expanding the variety of products or services it offers, leveraging shared operations or resources.

Learning Curve

The graphical representation of how an increase in learning comes from greater experience, leading to reduced costs over time.