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ABSTRACT. In this article we explore two citizen-based approaches to solving the problem of selecting a desirable level of public goods for a jurisdiction. The first approach seeks to inform decision-makers about citizens' preferences by observing the choices of citizens faced with the actual budget constraint facing the government and asking them to choose service levels within that constraint. The second approach gauges citizens' willingness-to-pay for their share of the cost of a desired level of public expenditure. In an effort to foster discussion and research into new modes of citizen participation in resource allocation we pose a model that combines both the constraints of the jurisdiction with the tax share of the respondent into a survey methodology that will reveal the underlying demand for government services in ways that are useful for public managers.
INTRODUCTION
Typically, public managers or elected officials select the amount of public goods and services to be provided and how much citizens will pay for them. This is because there is no observable demand schedule for many public services. That is, the underlying demand schedules for collectively consumed public services, such as police protection, are masked because they are paid for collectively through taxes. The resulting disconnect between the level of service provided and the amount preferred by citizens is one form of what is sometimes referred to as the `public goods problem.' Citizen participation mechanisms help to reveal to officials the underlying preference structure of the citizenry and provide decision-makers with a picture of the underlying demand for public services. However, the state of the art for involving citizens in these resource allocation decisions is in its early stages of development. There has been only a limited amount of research on citizens' willingness-- to-pay for various services. Further, only a small group of methodologies provides citizens with a realistic approximation of the complex trade-offs facing decision-makers. In this article we discuss the above literature and propose extensions of this research. Specifically, we propose a new survey method that queries respondents within a truly realistic decision environment; one that includes both government trade-offs and individual costs. In the end, it is left to elected and appointed public management officials to select service and revenue levels on behalf of a...