Author(s): Hernandez Perez, Adriana Azevedo
Date: 2008
Persistent ID: http://hdl.handle.net/10438/272
Origin: Oasisbr
Subject(s): Economia; Federalismo - Brasil; Economia; Economia; Federalismo - Brasil; Federalismo - Brasil
Author(s): Hernandez Perez, Adriana Azevedo
Date: 2008
Persistent ID: http://hdl.handle.net/10438/272
Origin: Oasisbr
Subject(s): Economia; Federalismo - Brasil; Economia; Economia; Federalismo - Brasil; Federalismo - Brasil
The government has two objectives in this economy: make the states invest in thepriority sector and equalize wealth among states. Applying the model of the Principal-Agent Problem, we obtain that the federal system may not increase society 's wellfare when the states not necessarily invest in its respective thepriority sector. We also obtain that it is possible to implement an optimal mechanism where government equalize wealth among states without cost and can make states invest in thepriority sector.