This paper investigates within an endogenous growth model how a congested productive governmental input should be financed if exclusion is possible. The instruments are taxes and fees. To create the macroeconomic equilibrium the planner has to ensure production efficiency with the optimal...

Many public goods are characterized by rivalry and/or excludability. This paper introduces both non-excludable and excludable public inputs into a simple endogenous growth model. We derive the equilibrium growth rate and design the optimal tax and user-cost structure. Our results emphasize the...

We analyze within a dynamic model how firms decide on capital investment if the accompanying adjustment costs are a function of governmental activity. The government provides a public input and decides on the degree of rivalry. The productive public input enhances private capital productivity...

Many public goods are characterized by rivalry and/or excludability. This paper introduces both non-excludable and excludable public inputs into a simple endogenous growth model. We derive the equilibrium growth rate and design the optimal tax and user-cost structure. Our results emphasize the...

In this paper the impacts of income and consumption taxes are analyzed within a model of stochastic endogenous growth with congestion. It is shown that the optimal amount of governmental input diminishes with uncertainty and that the optimal financing depends on the relation between the degrees...