#10035. Monopoly versus Individual Welfare When a Local Public Good Is Used to Attract the Creative Class

September 2026publication date
Proposal available till 28-05-2025
4 total number of authors per manuscript0 $

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Journal’s subject area:
Social Sciences (all);
Places in the authors’ list:
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Contract №10035.1 Contract №10035.2 Contract №10035.3 Contract №10035.4
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4 place - free (for sale)

Abstract:
We study the decision problems faced by a city authority (CA) who focuses on two different objectives in her attempt to attract members of the creative class to her city by providing a local public good (LPG). First, we compute the maximum tax that a creative class member is willing to pay to enjoy the LPG on offer by living in the CA’s city. Second, assuming that the CA acts like a “monopolist” interested in maximizing the total benefit to her city, we determine the number of members N to attract to her city and the amount of the LPG L to provide so that the total benefit is maximized. Third, supposing that the CA maximizes the welfare of an individual member, we ascertain the values of N and L that maximize this individual welfare. Finally, we compare and contrast the outcomes that arise from the CA’s focus on these two distinct objectives.
Keywords:
city authority; creative class; local public good; optimal membership; tax

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