| ID | 129825 |
| Title Proper | International security, multiple public good provisions, and the exploitation hypothesis |
| Language | ENG |
| Author | Ihori, Toshihiro ; McGuire, Martin ; Nakagawa, Shintaro |
| Publication | 2014. |
| Summary / Abstract (Note) | Since the 1960s Olson-Zeckhauser's (1966) analysis, its 'exploitation of the great by the small' has provided economists' core model of alliance's provision of security/defense. But with the end of the Cold War, countries' allocative behavior has diverged markedly from OZ's predictions for defense as a homogeneous pure public good voluntarily provided. This paper suggests a replacement for OZ, with the essential difference that 'defense' rather than being aggregated into their single public good is disaggregated into more realistic categories of self-insurance and self-protection. Because allocative behavior in public good groups is essentially driven by income effects, we concentrate on these, which become complex and conflicted, giving much greater scope for goods-inferiority. The analysis is followed by numerical simulations, which conform to actual experienced allocations in NATO much better than the conventional 'exploitation' model. |
| `In' analytical Note | Defence and Peace Economics Vol. 25, No.3; June 2014: p.213-229 |
| Journal Source | Defence and Peace Economics Vol. 25, No.3; June 2014: p.213-229 |
| Key Words | Self - Insurance ; Self - Protection ; Inferior Goods ; Exploitation Hypothesis ; Multiple Public Goods |