Theoretical Study on Voluntary Provision of International Public Goods and Distribution of Income and Factor Endowments

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Public goods whose benefits are nonrival and nonexcludable among nations is said to be international public goods. In the theory of voluntary provision of public goods, it is well recognized that total provision of public goods is independent of distribution of wealth. This is referred to as neutrality theorem of public goods. This study reconsidered the neutrality theorem within the context of international trade theory. It has been shown that the neutrality theorem is modified in an international trade model. In addition, by using an analytical framework of voluntary provision of international public goods, we considered the problem of resource allocation in the presence of cross-border pollution and the welfare effects of technology assistance to developing countries in an imperfect competitive market.