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

Pollution expenditure accounting, Normal 0 false false fals...

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

Planing, In planning activities how are the decision arrived? what are the ...

In planning activities how are the decision arrived? what are the different stages of analysis? which factors can be ignored and why? state the manner in which a degree of success

Forestry, Normal 0 false false false EN-IN X-NONE X...

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

How to prevent bulling, what could I write for pharigraph 2 on why a bully ...

what could I write for pharigraph 2 on why a bully bullies

Enactment of social norms into laws, Suppose there is certain social norm. ...

Suppose there is certain social norm. Its enactment into statutory law lowers people's private cost of its enforcement because it creates the possibility that violation of norm wi

Privatisation and decentralisation, critically examine that privatization c...

critically examine that privatization can always decentralize economic power

Overcome the barriers of having access to government data, QUESTION (i)...

QUESTION (i) "Public Sector data is seen as owned by everyone since it has been gathered about and from everyone, often compulsorily". Discuss the concepts of ‘Public data' whe

Policy implementation , Your organisation has tasked your to reduce the rat...

Your organisation has tasked your to reduce the rate of a particular type of incident or particular type of high risk hazards which is commonly occurring. Your task requires you to

Introduction of performance-related pay, Question: Awards for excellent...

Question: Awards for excellent performance are increasingly employed within the public service in many countries. These will or will not have a financial value. Performance-rel

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