@article {Chan428, author = {Nathan W. Chan and Matthew J. Kotchen}, title = {Funding Public Goods through Dedicated Taxes on Private Goods}, volume = {98}, number = {3}, pages = {428--439}, year = {2022}, doi = {10.3368/le.98.3.082721-0101}, publisher = {University of Wisconsin Press}, abstract = {We examine dedicated taxes (i.e., taxes on private goods used to finance public good provision) in a game-theoretic model of impure public goods. We show that a dedicated tax can increase or decrease demand for the taxed good. The optimal dedicated tax generally cannot achieve the Pareto-optimal allocation, but it can generate a conditionally efficient equilibrium with comparatively more or less public good provision, depending in part on complementarity or substitutability between the private and public good. We also demonstrate a neutrality result: when individuals can make direct donations, sufficiently low dedicated taxes will not impact equilibrium allocation.}, issn = {0023-7639}, URL = {https://le.uwpress.org/content/98/3/428}, eprint = {https://le.uwpress.org/content/98/3/428.full.pdf}, journal = {Land Economics} }