p.66

Lindahl's Solution and the Core of an Economy with Public Goods

Duncan K. Foley

Abstract

In an economy with an arbitrary number of consumers and an arbitrary number of commodities, some public and some private, I propose a generalization of Lindahl's equilibrium solution, and prove an existence theorem for it. A particular generalization of the "core" of an exchange equilibrium to an economy with public goods is proposed, and it is shown that a Lindahl equilibrium allocation is also a core allocation.