DOES THE PUBLIC SECTOR IMPLODE FROM BAUMOL'S COST DISEASE?
研究了鲍莫尔成本病对公共部门的影响，发现考虑私人和公共部门共同提供服务时，福利最大化的税率和公共就业份额可保持不变。
The root of the Baumol cost disease is higher productivity increases for manufactured goods than for services. The implied increase in relative costs of service production is widely claimed to have devastating implications for the public sector as a provider of tax‐financed services such as health, education, and care. To match the increasing costs it appears inevitable that tax rates would be ever increasing. It is shown that this inference does not follow under standard assumptions when accounting explicitly for service provision from both the private and public sectors. Strikingly under assumptions often made in the literature, the welfare maximizing tax rate for a utilitarian policy maker would remain constant despite the Baumol cost disease, and by implication the share of public employment in total employment will remain constant.