Explain ex-post heterogeneity, Public Economics

Assignment Help:

The other type is called ex-post heterogeneity which refer to the conflict (of interests) arising due to distributional implications of the public policy. Thus when a public policy has some distributional consequences, representative agents will be in conflict over distribution due to their respective "self interests". Ex-ante heterogeneity is important not only for distributive implications but also for understanding of the political aspects of the representative agents. It is also important in understanding of the time inconsistency problem of the policy process which arises when a policy maker maximizes welfare of a ‘representation agents'. In such situation, agents may, with respect to policy benefits, be identical ex-ante but are not identical ex-post.

Among non-political dimensions, we find markets being driven by heterogeneity but then the effects of heterogeneity are quite different. Further, in multiple agent welfare economics ex-ante and ex-post heterogeneity of agents is central to the analysis of optimal policy. Here it should be understood that welfare economics takes multi agent objective function as given, and weights the importance of heterogeneous agents for social welfare. Here ‘opinions' of different agents are taken as exogenous while determining the policy outcomes. Thus the focus of analysis remains only the calculations of optimal policy given the objective function.

In contrast, in public process, the main focus is often the endogenous determination of the objective which is maximized implicitly. Here weighs of the implied objective function are not exogenous. They are determined by the political process which in turn determines the outcome of the policy.


Related Discussions:- Explain ex-post heterogeneity

Indifference curve, eiplain why indifference curve are convex to the origin...

eiplain why indifference curve are convex to the origin

Summary of natural resource economics, Normal 0 false false ...

Normal 0 false false false EN-IN X-NONE X-NONE MicrosoftInternetExplorer4

Public sector, Are there any welfare or subsidy payments that should be ren...

Are there any welfare or subsidy payments that should be renewed or added? 2.What are the costs and consequences of providing the subsidies and welfare? 3.Are there any current sub

Bowling Alone, What are your thoughts on Putman’s “Bowling Alone,” the idea...

What are your thoughts on Putman’s “Bowling Alone,” the idea that there has been a decline in social capital in North America? Do you agree or disagree with the assertion? Support

The myth of public goods by mark davis, summarize the basic tents of the ar...

summarize the basic tents of the argumentsin this case

Health and safety control systems, The report which you should submit to me...

The report which you should submit to me should include: A brief analysis of the control systems required for the health and safety of operatives and others who may be affect

Policy process mechanism, explain the stages and various coordination mecha...

explain the stages and various coordination mechanisms involved in policy processes

GDP, 1. If GDP is not a good measure of economic well-being, why then it is...

1. If GDP is not a good measure of economic well-being, why then it is always used by the president in his/her STATE OF THE NATION''S ADDRESS?

Public relations process, Question 1: ‘Public Relations professionals m...

Question 1: ‘Public Relations professionals must understand how public opinion is formed, how it evolves from people's attitudes, and how it is influenced by communication.' D

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd