Talk:Public good (economics)

Pure public goods

I think people are merging a lot of terms together and making it wishy washy. I think in the very least some discussion, and distinction, should be made between types of public and private goods, and between public goods and *pure* public goods (those that are both 100% nonrival and nonexcludable).

It would also be useful to draw a Cartesian plane with nonrival on one axis and nonexcludable on the other and map out some goods that vary from 0 - 100% for each. As well the rival component is often called congestability, and is an important concept that complements it.

Other then that, this article looks very good. --ShaunMacPherson 18:05, 22 Mar 2004 (UTC)

The terminology used in this article isn't quite what I'm familiar with. My understanding is 'public good' refers to a non-rival good (the definition given by Samuelson in 'The Pure Theory of Public Expenditure' - which if it didn't introduce the term is the classic paper as far as I'm aware.) When I studied economics 'pure public good' was used for a good that's both non-rival and non-excludable - what's being called a public good here. I have no idea how you'd go about measuring 'publicness' of particular goods as a percentage. This is the first time I've come across 'club goods'. If I'm just wrong or maybe out of step with developing lingo that's fine, but it would be good to have some references to tie down what the standard usage is and how it may have developed.Bengalski 22:33, 19 December 2005 (UTC)

Is there anything we could do to get rid of two inconsistencies in the very concept of the public good? The first one is using the term public to refer to the citizens of a nation instead of the citizens of a global society. In a NPOV version the basic concept should stand for the most general public especially when concepts like entrepreneurship and free market, when explained to foster public good, are self-evidently understood as global. National good should belong in a subordinate class clearly told to express national norms or ends. This change would have consequences particularly in the free rider section. National defense of say United States is by no means a good for free riding in Russia or vice versa. As a matter of fact the whole concept of free riding is biased when used in some purpose by some government or some economics. The second problematic thing is the definition non-excludable. There is not a thing that cannot and have not been excluded from someone. At this moment there are thousands of people who are in prison excluded from sunshine, millions of people are excluded from expressing themselves freely and billions of people are excluded from using the knowledge someone has produced. I think that the only way to make sense – and public good – is to define public good only by non-rivalrousness, as a good that by nature can be consumed without lessening anyone else’s chance to consume. And if someone or some government prevents anyone from consuming public good, it does so for the benefit of certain people or nation, not the global public. MattiH 09:03, 26 January 2006 (UTC)

The article states that "in the real world there may be no such thing as an absolutely non-rival or non-excludable good" - but it seems that information goods are at least absolutely non-rival. - Never mind, should have read the whole article - but maybe note the non-rival features of information goods in the intro?

It's actually a bit more complicated than that. Information is non-rival for consumers, but there is rivalry if it is an input factor, because it only gives you an edge over your competitors if they don't have it. Rl 19:05, 20 March 2007 (UTC)

I have to agree that this should be updated upfront. Information goods are clearly fully non-rival and are practically non-excludable. The existence of rivalry in an ordinary sense in "trade secrets" does not constitute "rivalness" in an economic sense; excludablity does exist for 'trade secrets', but only to a very limited degree. 67.241.25.16 (talk) 02:20, 18 January 2010 (UTC)

left, right and other politicking

There was a paragraph about how left-wing and right-wing people disagree on which goods are public. I think it doesn't belong because those sort of political disagreements aren't about "public goods" in the technical sense as defined at the top of the article, but rather are about "public goods" in the political sense (that was originally inspired by the other definition), meaning "goods I think government ought to provide". I deleted that paragraph and replaced it with an attempt to explain the confusion. Here's the part I removed:

That's inaccurate. There is no agreement in Academia about anything beyond the bare definition of a public good (consider the lighthouse article by Coase). The scale of the controversy when the rubber hits the road is very telling, although I'm not sure what it is saying. It's certainly worth noting that one of the key concepts economics provides to justify government is defined in a way that is controversial to a point where it's fairly useless for all practical purposes.Rl 20:10, 22 Aug 2004 (UTC)

My impression is that most partisans who try to justify particular real-world goods as "public goods" don't know any economics. They are parsing the phrase commonsensically, in the same way as "public service", or "public school" and assuming they know what it means. I think we should help all these confused people by focusing on the actual definition in terms that economists can agree on, and not saying anything that implies we're really talking about "goods that benefit the public". Because ALL goods benefit the public. All goods have a "public goods" aspect. When I paint my house, I make the neighborhood look better. When I buy a sandwich, I keep that store in business. Bah...I should probably focus more effort on improving the article and less on talking about it here, but the side arguments probably are helping to clarify what should be in there. I'll take another stab at it soon.

At a minimum, we need a new section called "The political use of public goods arguments" and a section called "Criticism of public goods".

--Blogjack 05:39, 24 Aug 2004 (UTC)

I don't remember hearing people use the term "public good" for anything other than a good that meets both defined criteria to a reasonable extent. The controversy I am familiar with is the interpretation of said criteria: Which goods are close enough to a pure public good to justify policy decisions based on that label?

Instead of "Criticism of public goods", I'd much rather have an "Examples" section, with both pro and con arguments listed for each example.

By the way, it's good to discuss stuff on the talk page because it lowers the risk of edit wars.Rl 10:59, 24 Aug 2004 (UTC)

Any list of public goods is highly controversial due to implications for the scope of government: if a good is accepted as a "public" one, it will encourage calls for some form of government intervention under the theory that government might be able to produce a more efficient level of the good. Thus, people "on the right" will have a shorter list of public goods than those "on the left." libertarians and advocates of laissez faire, may restrict the set of public goods to national defense and the enforcement of property rights and contracts. The latter, new liberals and social democrats, typically have a more extensive list.

--Blogjack 03:37, 19 Aug 2004 (UTC)

After some thought, I also decided to yank this paragraph:

Public goods are said to be "pure" when they possess these properties absolutely. In practice, many or most public goods are impure or are confined to particular localities. A public good would be for society as a whole (the public), while a "collective good" is merely for a sub-set of society.

Reasoning: The article starts with "in economics..." and the wishy-washiness here is not a characteristic of the "economic" definition of public good. A public good is a theoretical construct with certain properties; the definition of a public good is that it has those properties and it is a public good to the degree that it has them. So to say "In practice, many or most public goods are impure or are confined to particular locations" is kind of like saying "in practice, most frictionless surfaces have some friction or have friction at certain times." or "in practice, most perfect competition isn't totally perfect".

--Blogjack

COMMENT: the fact is that economics is not a "science" of simple abstract and clean concepts. We use such concepts all the time, but any practicing economist knows that the correspondence between them and the messy world of reality is at best shaky. The empirical world isn't the black and white of pure economic theory. However, I made it clear why it's important to bring in impure public goods and other such "shades of gray." Thus, I would say "in practice, physicists treat surfaces which do have friction as frictionless as a first approximation" or "economists often use the model of perfect competition as a first approximation to understand real-world atomistic markets." Jdevine 14:43, 19 Aug 2004 (UTC)

Seconded, although I don't fully agree with your assessment of the state of the art. In my experience, many practicing economists like to think that a shaky correspondence between a model and the real world means the world should adapt to fit what they understand. Classic greek approach to science.Rl 20:10, 22 Aug 2004 (UTC)

RESPONSE TO COMMENT: I like your revised version much better - the additional nuance helps. I'm okay with the pure/impure distinction as long as we're careful to distinguish our terms. But I still question the usefulness of the concept "public good confined to particular localities". Even national defense is confined to a nation, right? I think it goes without saying that even nonexcludable goods have a relevant scope.

There are still a few bits of the article that strike me as political boosterism - shoehorning in support for some position or system that's mostly unrelated to the topic at hand. I had to remove this phrase:

However, since the underproduction of public goods can be disastrous and a democratically-controlled government is more likely to reflect the citizens' shared social values, most democratically-oriented countries rely on government here.

All governments provide such public goods as national defense and a legal system, regardless of whether they are democracies. To say "democracies do what the people want, so democracies provide public goods like national defense" implies that some non-democracies don't provide public goods, which is false, and to say that most democratically oriented countries rely on government to provide public goods implies that some do not, which also is false. I'm also not convinced that citizens' shared social values are terribly congruent with "public goods" in the economic sense - that the people want it doesn't make it a public good, and that it's a public good doesn't mean people want the right amount of it.

If you are trying to say that democracies are better at providing some public goods than non-democracies, be specific: Which public goods are we talking about, which countries and systems are we comparing, and how are we comparing them? What's the evidence? --Blogjack 02:42, 20 Aug 2004 (UTC)

Walter Block

Temporarily removed:

Walter Block has demonstrated that no such thing as a public good' exists, in his essay National Defense and the Theory of Externalities, Public Goods, and Clubs, featured as chapter 9 in Hans-Hermann Hoppe's The Myth of National Defense, available in PDF format from The Ludwig von Mises Institute.

I request if this goes back in, that it should:

1. Be put into a seperate section, like say, critisms of public goods or some such.
2. Include some reasons as to why Walter Block believes that.

If I have time, I will read the attached link and add it back in, but it might be faster if 218. does that instead. Thanks. Jrincayc 13:23, 27 Apr 2004 (UTC)

I skimmed the article National Defense and the Theory of Externalities, Public Goods, and Clubs, and my opionion is that Walter Block does not understand that these are models (all models are wrong, some models are useful) and then proceeds to complain that because the model is not perfect, the model is completly useless. He also fails to understand game theory (as in for national defense just because it would be better if every nation did not pay for it, it is good idea for an individual nation to not pay for national defense.) or oppertunity cost (pg 324, the hamberger example, the accounting benefit of the hamberger may be zero, but the oppertunity cost is positive since presumably it still can be sold in that day.). As such, I do not consider it a useful addition to the article, except as a example of mistakes that people make about public goods. Jrincayc 13:36, 28 Apr 2004 (UTC)

Subsidies and competition

How is "subsidies may sometimes result in some form of competitive market" an improvement over "subsidies typically result in some form of competitive market"? There is a (major) market distortion, but if I consider examples of subsidies, they do result in "some form of competition": subsidized farmers compete with each other (to some degree), subsidized Boeing/Airbus do the same, subsidized artists compete for audience, etc. This very property of subsidies is what tends to make them better than government provision. Your edit implies that the cases where subsidized markets result in no competition whatsoever make up more than a tiny fraction of all cases. What are the examples that I'm missing? The real problems with subsidies are somewhere else: The cronyism you pointed out, the fact that it is hard/impossible to determine a level of market distortion which nets a positive result (even supposing everyone means well), or the experience that it is extremely hard to remove subsidies even if the reasons for their introduction have ceased to exist (basically the public is funding a special interest group to fight for continued subsidies). Rl 10:05, 29 Jul 2004 (UTC)

There are lots of cases in the poorer countries a couple of decades ago where the subsidized producers were monopolistic. There's nothing about the private sector that makes it inherently competitive. Even the government isn't inherently monopolistic. (In Los Angeles, we have public schools that compete for students.) Jdevine 22:12, 29 Jul 2004 (UTC)

Fair enough. I like most recent edits, too. Comments:

• The distinction between "pure" and other public goods was not clear enough before, but now we also have "true public good" and "collective good". Confusing.
• I seem to remember that David Friedman's list of public goods is even shorter than what you suggest for libertarians. The best way to deal with the controversy might be to cover pros and cons of a few examples (e.g. Coase/lighthouse etc.).
• The principal agent problem relates to information asymmetry, it is orthogonal to subsidies. If there is anything about subsidies that makes them particularly susceptible to the PA problem, you should note that.
• Minor nit-pick: The punctuation for "unfunded mandates" and "cronyism" should go after the quotation marks. Rl 10:19, 30 Jul 2004 (UTC)

• I fixed the first one.
• I softened the second, so that it's not necessarily referring to Friedman.
• I clarified why PA appears here. If subsidies are seen as avoiding big government, they may not do so.
• I was taught in school to put the period inside the quotes. Is there a WikiConvention on such matters?

Jdevine 17:08, 30 Jul 2004 (UTC)

Oh I see: there's a link attached to "quotation marks." -- oops I meant to write "quotation marks". Okay, I'll fix it. Jdevine 17:10, 30 Jul 2004 (UTC)

The general discussion of pros and cons of subsidies should probably go to the article on subsidies (the English version is pretty thin and could do with some additions). For now, I simply changed the bit on subsidies to make it sound less negative. I would agree that subsidies are a big problem in many economies (especially in those that can afford to waste money), but for public goods -- where they exist -- no solution works in every case, and every possible solution has a potential for nasty side-effects. ... IMO this article should help people identify public goods and show the trade-offs of possible solutions and how those trade-offs are affected by various factors.Rl 13:32, 4 Aug 2004 (UTC)

Most recent changes

I didn't do a thorough review, but I noticed one change I disagree with. It changed "this effect and counter-measures taken to address it can diminish or obliterate the benefits of the subsidy." to "this effect and counter-measures taken to address it can diminish the benefits of the subsidy." If you don't like obliterate -- fine, suggest a better way to put it. However, the argument in economics is clear: The negative side-effects can in some (most, all, depending on who you ask) cases outweigh the benefits and make the whole thing counter-productive. I'm afraid "diminish" does not cover that.Rl 13:54, 3 Oct 2004 (UTC)

Merge

Merge with public services. - Jerryseinfeld 17:24, 18 Dec 2004 (UTC)

In my opinion these articles should be keep seperate. Public services is a desciptive term with broad general applicability. Public good is a specialist economics term. Combining the two concepts into one article would cause confusion. mydogategodshat 05:41, 19 Dec 2004 (UTC)

Oppose merger, agreed with Mydogategodshat. Public services are just a type of public goods, which are much broader category usded in economics. Jerryseinfeld, next time please read both articles carefuly and then explain your reasons. --Piotr Konieczny aka Prokonsul Piotrus 10:22, 19 Dec 2004 (UTC)

Oppose, public services are things provided by the government. Public goods are goods that are non-rivalrous and non-excludable. Something can be a public service and not a public good (such as education), and something can be a public good but not a public service (such as the text of a book). Jrincayc 14:47, 19 Dec 2004 (UTC)

I also oppose. a "public good" is a technical term for a kind of market failure. A "public service" is simply something the government does. Jim 20:55, Dec 21, 2004 (UTC)

I oppose merging, the terms are obviously related, but so are a lot of things, and clearly deserve their own articles. Martin 10:36, 30 December 2005 (UTC)

Authorship and invention????

How on earth did these come to be defined as public goods? Icundell 21:18, 21 Dec 2004 (UTC)

Because of the characteristics of non-excludable and non-rivalrous, it was felt that the market would not always price these goods correctly. If you cannot exclude people that do not pay for the goods, from using them, producers would offer to the market far less of these goods than what is socialy optimal. For this reason many (but not all) of these goods became the domain of the public sector (government), either through the direct provision of government services, or though legally protected monopolies such as copyrights and patents. mydogategodshat 03:54, 23 Dec 2004 (UTC)

Not all of them are public. But works with expired copyright definetly are.--Piotr Konieczny aka Prokonsul Piotrus 13:53, 23 Dec 2004 (UTC)

Quite. I think there should be some thought about the difference between in the public realm and in the public domain. And I think Microsoft might strongly dispute the inclusion of software development. Icundell 20:05, 23 Dec 2004 (UTC)

Yes, Piotrus seems to be thinking in legal terms. It is mentioned above that the term "public good" should be clearly distinguished from the general term "public services": Likewize it must also be distinguished from the legal term "public domain". mydogategodshat 22:56, 23 Dec 2004 (UTC)

I think a great deal more thought is needed re the inclusion of these terms. With something like public transport or education, there is a clear 'public bad' alternative (whether we accept the alternative, is another issue: from a theoretical standpoint, it is there). But the inclusion of the last three items seems to me to be an attempt to slip a bootlegger's charter into the theory. Knowledge is a public good. The process by which it is created and distributed is not. And the specific expression of a form of knowledge (from MS Excel, to Harry Potter and the Monstrous Marketing Machine) is most certainly not, legally or theoretically. Icundell 00:08, 24 Dec 2004 (UTC)

The issue of "public bad" does not factor into the discussion. The term "public good" does not necessarily describe something that is "good". We are not contrasting a public good with a public bad. We are contrasting a private good with a public good. Because of the characteristics of non-excludable and non-rivalrous, the private sector might not want to produce the good, unless a public body can guarantee some sort of monopoly protection (like a patent or copyright). mydogategodshat 21:01, 25 Dec 2004 (UTC)

Well, yes it does, because without public bads it is merely an unviable good, not a public good. The esternalities are the key to the whole issue. You are looking through the wrong end of the telescope. But since it is demonstrably true that both authorship and invention were produced in vast quantities before either copyright or patent were thought of, the question is entirely moot. Icundell 18:36, 26 Dec 2004 (UTC)

I cannot respond to your comments because they do not make sense to me. Maybe someone else can figure out what you are trying to say. mydogategodshat 01:14, 28 Dec 2004 (UTC)

I have included language on intellectual property that I think is neutral. The crux from the economics perspective is that most types of intellectual property are non-rival, and hence public goods (but not pure ones). The other part of this is that it is difficult (but not impossible) to exclude others from making use of intellectual property. The trade-off of copyright and patents is sharing of the information in return for a temporary monopoly and the legal mechanism to enforce those rights.--Gregalton 12:54, 11 December 2006 (UTC)

Removed external link

• Are education and transportation public goods?

I removed this external link. The text is rather confused and the linked page seems mostly interesting in promoting some book.Rl 20:55, 8 Jan 2005 (UTC)

Should not use Wikipedia as an example

This article twice references Wikipedia as an example; this goes against the general principle of Wikipedia not being self-referential: perhaps something like Linux development might be a better example? -- Anon. 20:22, 17 Jun 2005 (UTC)

The principle of non-self reference means that we should not give Wikipedia as a source for other Wikipedia articles (see also Wikipedia:Citing Wikipedia). It does not mean that we should avoid mentioning its very existance. While adding the Linux example is a good idea, I believe that a reference to Wikipedia being a public good should remain in the article. --Piotr Konieczny aka Prokonsul Piotrus ^Talk 20:46, 17 Jun 2005 (UTC)

...This seems ratherbackwards on both examples -- to the best of my knowledge neither Wikipedia nor Linux are subsidized by any government.

...which, however, is not the topic of this article. Public goods are not the same as goods whose production are subsidized by the government.

I strongly agree with the grandparent post, Linux development or another Open Source project are a much better example. I would have rather the grandparent post not mentioned the self-referential idea (the parent post went a bit off track) . But it doesn't seem correct for Wikipedia to use itself as an example out of the blue like that... Thoughts? (Btw this can EASILY be fixed if someone REALLY cares... 07:54, 26 April 2009 (UTC)

User pays

I've added a very basic stub for User pays. This page seems sorta-kinda-semi related, so I thought it best to give a quick heads up here. -- All the best, Nickj (t) 07:22, 6 February 2006 (UTC)

Deletion of "Criticism of public goods theory"

The section named "Criticism of public goods theory" has just been deleted. Nikodemos has a point, but there were valid point in there that directly addressed claims made in the article. Algae 16:35, 13 March 2006 (UTC)

I just added - weakly - one of those criticisms back into the main text: a mention of the fact that good government is itself a public good. Implying that to say "we'll solve the public goods problem by having government provide the goods" just moves the problem back a level to the question of how do we solve the public goods problem of (a) figuring out how much of this good should be provided by government, and (b) making it in the government's interest to efficiently provide that amount. This is a criticism made by David Friedman and Tyler Cowen and various other libertarianish economists and I've never seen a good response to it. --Blogjack (talk) 15:50, 4 March 2008 (UTC)

started clean-up

I've started trying to clean up this page to bring it in line with mainstream, properly sourced, terminology. As it was there was a mess of different uses and irrelevancies. The key to this, as everywhere in wikipedia, has to be working from notable sources rather than people just adding in whatever they remember ad hoc. Here the most notable sources are a) the standard graduate micro textbooks - I listed three of the big ones in the references section; also New Palgrave dictionary of economics is a very mainstream source; b) the original books and journal papers by the big thinkers - Coase, Samuelson etc. Right libertarian websites may be relevant for some of the political debates arising, but they come some way down the scale of notability when we're talking about basic economic definitions and theory.Bengalski 13:02, 14 March 2006 (UTC)

The previous definition of public good (non-diminishability + non-excludability) is very common in economic literature. Is it correct to claim that "technically speaking such goods should be called pure public goods"'? (What does "technically speaking" mean, anyway?) . I don't recommend focusing on micro textbooks; the complete picture is way beyond their scope. I find it also odd that you would cite Coase and Samuelson to support your assertion: Samuelson talks about "collective consumption goods" in the referenced paper, Coase doesn't mention "public goods" in his lighthouse piece. – Terminology in this area is a complete mess and the excludability criterion was a horrible idea to begin with, but it caught on and we are not helping the reader if we pretend that there is an agreement when there is none. – By the way, does anyone know who came up with the non-excludability idea? Algae 17:16, 14 March 2006 (UTC)

Okay Algae, I agree there are those who use the terminology that way - but we need decent sources to get to the bottom of this. On textbooks: I'm not suggesting we take their word for the 'complete picture', but they are important sources - like it or not books like Mas Collel et al. are used almost canonically in mainstream economics - that's what's taught to graduate economics students, and so forms a common base of knowledge in the profession. Eg. I've seen plenty of papers where the authors cite these books for their basic definitions, if they bother to give a reference at all. And I think I'd choose them over eg. 'specialinvestor.com'. If there are other notable economists who use the terminology differently we should provide references and make clear that there are two uses, but I think what I have written is probably the mainstream version. Would you accept New Palgrave as an authoritative source - I'll have a look at it tomorrow, may also tell us something about the developing history of the term which would be good? The alternative I guess is to trawl through every major economist who's written on this subject and check their usage.Bengalski 17:46, 14 March 2006 (UTC)

Here's a little paper free on the internet [1] which says (following another paper it cites - if you have jstor access) defining by 'non-rivalness' alone is the 'mainstream' approach, but then has an interesting (well ... if you're interested in this all that much) discussion about the logical relation between the two properties. Note this paper also cites Varian, and indeed Samuelson - the same quote I gave - even though (at least at that point) Samuelson used another term. Also, to confuse things further, it distinguishes between 'joint consumability' and 'non-rivalness'.Bengalski 18:22, 14 March 2006 (UTC)

The emphasis regarding "micro textbooks" was meant to be on "micro", not "textbooks" :-). Public goods are not an exclusive domain of microeconomics.

JITE is not on JSTOR it seems; the article might have been an interesting reference, but I don't believe in providing references that hardly anyone has access to.

As for the linked paper, it is worth noting that (according to the abstract) "joint consumability has become the main or sole defining characteristic of such goods", implying a) that this used to be different and b) that not non-rivalness, but joint consumption is the proper criterion (which, as you said, it clearly distinguishes). Gravelle and Rees, on the other hand, describe non-rivalness in their definition. – Even if we're not sure about the rivalness part, I guess we can safely drop non-excludability as a requirement for a public good. Cool.

It is not up to me to accept some source as authoritative, but it would certainly be interesting to have a source that could shed some light on the history of the term. – The fishing expedition through every major economist's writings might actually be material for an interesting paper.

I wonder if "pure(ly) public good" has seen similar changes over the years. I don't think the difference between "public goods" and "pure public goods" is always seen as a matter of excludability.

The article currently notes: "Some writers have used the term public good to refer only to non-excludable pure public goods. They may then call excludable public goods club goods." In "An Economic Theory of Clubs", James M. Buchanan wanted to fill the "gap between the purely private and the purely public good." He points out that excludability is a precondition but rarely a problem. He also notes that you can share many private goods as well (e.g. time-sharing), so his club goods basically cover the whole range. It's basically a theory of the trade-offs of joint ownership. Algae 21:20, 14 March 2006 (UTC)

Algae, you're very right in many ways. This terminology is so often used in a slapdash manner and to confusing effect. It will be a real achievement if we can give a serious, well-sourced account of the use of the term 'public good' (and various sub-types) and its historical development. (And when we're talking about history, I was quite wrong to start with Samuelson - we should go back to Hume and Smith at least.) So yes, it seems there's lots of ambiguity and variance in how these terms are used - let's try and explain that in the article and at the same time try to finish up with something graspable so we can get on to the real meat of the subject....Bengalski 22:51, 14 March 2006 (UTC)

Evolution of the term

I have checked another seminal work on Public Goods:

Olson, Mancur (1971) [1965]. The Logic of Collective Action : Public Goods and the Theory of Groups (Revised edition ed.). Harvard University Press. ISBN 0-674-53751-3. {{cite book}}: |edition= has extra text (help)

This classic focuses on non-excludability. "A common, collective, or public good is here defined as any good such that, if any person X₁ in a group X_i, ..., X_i, ..., X_n consumes it, it cannot feasibly be withheld from the others in that group." (p. 14)

Olson also refers to Head (reference below): "Head has also shown most clearly that nonexcludability is only one of two basic elements in the traditional understanding of public goods. The other, he points out, is 'jointness of supply'. [...] The polar case of jointness would be Samuelson's pure public good [...] By the definition used here, jointness is not a necessary attribute of a public good." (footnote p. 14)

John G. Head (1962). "Public Goods and Public Policy". Public Finance. 17 (3): 197–219.

Algae 13:26, 27 March 2006 (UTC)

Concur with Algae that credit needs to go to more than just Samuelson. Samuelson may have written the definitive modern treatment, but Olson notes that a history may be found in Musgrave, Richard A.; Peacock, Alan T., eds. (1958), Classics in the Theory of Public Finance, London: Macmillan, ISBN 0312121628 and in Baumol, William J. (1952), Welfare Economics and the Theory of the State, Cambridge, Mass.: Harvard University Press. From those, Olson notes that key developments in the history of the concept include

• von Storch, Heinrich Friedrich (1815), Cours d'économie politique, St. Petersburg: A. Pluchart, in which he first lays out a difference between public good and private benefit.
• Say, Jean-Baptiste (1840), Cours complet d'économie politique practique, Paris: Guillaumin Libraire, in which he "endorsed and elaborated Storch's argument".
• von Wieser, Friederich (1958), "The Theory of Public Economy", in Musgrave, Richard A.; Peacock, Alan T. (eds.), Classics in the Theory of Public Finance, London: Macmillan, ISBN 0312121628, in which he notes a distinction in the equality of consumption of goods and services provided by the state as against private goods
• Sax, Emil (1958), "The Valuation Theory of Public Taxation", in Musgrave, Richard A.; Peacock, Alan T. (eds.), Classics in the Theory of Public Finance, London: Macmillan, ISBN 0312121628, in which he "distinguished publicly owned enterprises from state activities that benefit the whole citizenry."
• Mazzola, Ugo (1958), "The Formation of the Prices of Public Goods", in Musgrave, Richard A.; Peacock, Alan T. (eds.), Classics in the Theory of Public Finance, London: Macmillan, ISBN 0312121628, in which he emphasizes indivisibility of public goods
• Wicksell, Knut (1958), "A New Principle of Just Taxation", in Musgrave, Richard A.; Peacock, Alan T. (eds.), Classics in the Theory of Public Finance, London: Macmillan, ISBN 0312121628.

Olson concludes by stating "Thus the continental writers on public finance had learned from each other's errors and progressively improved the analysis which after many decades culminated in Wicksell's conception of the problem that he expounded in the essay in which he propounded his 'unanimous consent' theory of taxation." Olson claims that Baumol and Samuelson accept Wicksell's analysis. Ehusman 17:13, 25 February 2007 (UTC)

Thank you for contributing to this slow paced discussion. I fully agree with your assessment that Samuelson is getting too much credit. The initial discussion wasn't even about credit but about the meaning of the term. Even after Samuelson, the list of criteria defining these goods varied. In other words, there are several definitions contradicting each other. Algae 18:54, 25 February 2007 (UTC)

Coasian solution page

I created Coasian solution so that searching for "coasian" gives a better result. I'll leave it to others to decide how to divide up the material - use a {{main}} tag on this article to direct there, or redirect from Coasian solution to Public good? Once that's decided, Coasian should redirect to the correct place (I pointed it at Coasian solution). --Chriswaterguy talk 00:03, 29 March 2007 (UTC)

Non-rejectable

The opening paragraph describes public goods as being non-rejectable. This term doesn't seem to appear in the article at all, and it is non-obvious to me what this means. Can someone elaborate on what this means, or whether this should be part of the definition at all? Timbatron 20:45, 2 May 2007 (UTC)

I meant to give the editor who introduced the term some time to source the claim, but too much time has already passed. Thanks for reminding me. Reverted. Rl 06:43, 3 May 2007 (UTC)

Thanks! I didn't think the term belonged, but I'm not an expert on the issue. Timbatron 16:04, 3 May 2007 (UTC)

Health care as a public good

The sentence that states Common examples of public goods include: defense and law enforcement (including the system of property rights), public fireworks, lighthouses, health care, clean air and other environmental goods, and information goods, such as software development, authorship, and invention raises a question that I hope someone with greater economic insight can answer. If health care were non-rivalrous, wouldn't that mean that other's use would not cause scheduling delays or rationing of services? Doctors typically see patients sequentially, and one appointment prevents another from occuring at the same time. And by non-excludable, does this include non-emergency care for 47 million uninsured Americans? This isn't meant to be snarky, it just seems different from clean air, national defense, and lighthouses -- like classifying taxis as public goods, even though they carry one passenger at a time, and restrict themselves to paying customers unless there is an emergency. Or should a note be made of how different countries view its status as a public good? Snarfangel 05:05, 19 July 2007 (UTC)

You are correct. The recent addition of health care was a mistake, and I have just reverted it. Disease prevention is a part of health care that can be considered a public good. For instance, everyone benefits from high inoculation levels in a population. Rl 05:22, 19 July 2007 (UTC)

opening line

Recent modification to the opening paragraph... The editor believes it's made things clearer. I think it makes things fuzzier. Also, "Government provides goods and services with these characteristics" may or may not be true. CRETOG8(t/c) 19:50, 14 October 2008 (UTC)

Adam Smith

I just removed a couple paragraphs labeled "Challenges to Adam Smith's Market for Public Goods". What I removed was this:

Some argue that a potential failure of a market-based 'system,' as outlined by Adam Smith, is that alone it may be unable to provide necessary public goods. Proponents of the failed market-based view suggest that the collective must do something together to provide these goods. For example, some argue that the defense of a country will never be adequately provided for without a draft or a significant tax.

A more detailed critique against Smith's when applied to public education is that he developed his theory at a time when education was limited, provided only by private funding, and was not seen as a valuable input to public good. At that time, only labor was considered a valuable input. Today, it is possible, however, to discriminate and measure different degrees of human input. Some conspiracy theorists might espouse a view that politicians and academicians persist in furthering these outmoded ways of thinking to preserve economic hegemony of important wealthy economic players. However, it is more likely that the challenge in determining the relative values among various public goods plays a larger role.

I removed it because (a) it ascribes to Adam Smith, without citation, views Smith didn't have, (b) it posits that Some argue with those invented beliefs while not specifying who these Some might be, (c) the writer goes on to make his/her own unsourced original-research critique of the invented positions. --Blogjack (talk) 18:09, 5 June 2009 (UTC)

Free to air television

How is free to air television a public good? It is an excludable resource. If the spectrum is being used to broadcast content, it can't be used for something else. Aprock (talk) 03:36, 4 September 2009 (UTC)

Spectrum is a scarce resource used for the production of the public good free to air television. Just like weapons used for the public good national defense are scarce resource. Of course, nowadays it is possible to encrypt broadcasts (and that would be a relevant form of exclusion), but if you did that, it would not be free to air television anymore. Rl (talk) 07:16, 4 September 2009 (UTC)

I don't follow. If something uses a rivaled and excludable resource, how can that something be a public good? Aprock (talk) 13:57, 4 September 2009 (UTC)

Because what makes public goods special is the specifics of their consumption (non-rivalrous and/or non-excludable). Basically, in the case of public goods, your production costs (if any) are independent from the number of consumers. Rl (talk) 12:02, 7 September 2009 (UTC)

Broadcasting costs are very much a function of the number of consumers you want to reach. Aprock (talk) 15:31, 7 September 2009 (UTC)

They are a function of the geographic area you want to cover. It does not matter how many people are receiving your broadcasts in that area, your costs will remain constant (public goods do not have to have zero distribution costs, anyway; look at the definitions, read the article). In this regard, free to air television is like fireworks or national defense. Rl (talk) 20:13, 7 September 2009 (UTC)

The number of people you want to reach is a function of geometric area. In that sense, it is excludable. You can choose to serve, or not serve, a region. It's up to those providing the transmission. A classic example of the is the KRON]/NBC kerfuffle that occured in the bay area a few years ago. Aprock (talk) 02:47, 8 September 2009 (UTC)

MP3

The MP3 example is not a good one. Unrestricted file sharing of MP3 files is illegal, as the Napster and Kazaa cases made clear. Napster ceased file sharing operations in 2001, Kazaa in 2006. So using MP3 file sharing as an example of a public good is incorrect, owing to its excludable nature. (Mgtguru (talk) 10:13, 8 January 2010 (UTC))

Air as a public good?

It seems a bit misleading to use air as an example of a public good. Clean air is often treated as a rival good, especially when looking at pollution. —Preceding unsigned comment added by 76.21.246.61 (talk) 15:49, 2 March 2010 (UTC)

I tend to agree. Perhaps many goods traditionally treated as public goods are, at the extreme, rivalrous. Water was probably at one time, when human populations were much smaller, effectively non-rival in most locations. Air may be trending rivalrous, at least in terms of pollution filtering capacity. More pedantically, consumption of one molecule of oxygen (and conversion to CO2) preculdes another from consuming the same molecule. Even national defense could be considered rivalrous where defense is required in multiple, functionally separated locations or against multiple, differentiated threats. Information goods seem much safer in terms of being truly non-rival. I wouldn't want to go overboard with caveats, but air seems a particularly problematic example. Moretz (talk) 11:16, 18 May 2010 (UTC)

Need an expert

How is national defense different from national health care when it comes to being excludable? Same for national education. USchick (talk) 23:58, 28 July 2010 (UTC)

Healthcare is a rivalrous and excludable good, since e.g. if I visit the doctor, there is one less visit available to everyone else, and my doctor visit does not make anyone else better off (except in limited and indirect ways). Education is similar; while educational resources may be information goods with public-good features, the services involved (giving lectures, overseeing tests, maintaining facilities etc.) are not. Also, except for primary and secondary education, the benefits of education largely accrue to the person who receives the service, rather than the general public. --Classicalecon (talk) 00:38, 29 July 2010 (UTC)

The discussion here is about national health care, national defense and national education, all paid for by tax dollars and provided by a specific country only to its citizens. When you see your private doctor and pay for service, this has nothing to do with national health care, and one doctor is not representative of national health care. Another person living in the same country can not be excluded from national health care just like they can not be excluded from national defense or national education. And with lectures now being online and downloadable, you don't even have to take up a seat in a class room. The point here is ACCESS. All three of these are paid for by taxes and available to the citizens of that one sovereign nation. USchick (talk) 00:06, 31 July 2010 (UTC)

I'm not going to address national defense comprehensively, since its classification as a public good is disputed anyway, as the article points out. The fundamental differences between national defense and healthcare/education are: (a) National defense is not excludable per se: all people who reside within the sovereign nation's perimeter benefit from defense. There are few or no exclusion mechanisms other than kicking citizens out, which is clearly not a viable policy. (b) National defense is not rivalrous: the cost of defending a perimeter from invasion does not obviously rise with the number of citizens in it.

I have addressed the distinction between educational resources including online and downloadable lectures--which are non-rivalrous, although copyright and other laws might make them excludable--and educational services in my previous comment. Both healthcare and educational services are labor-intensive and have few economies of scale (which would introduce some degree of non-rivalry), hence they don't even qualify as club goods or social goods. It is true that national policies may make these services available for free to the citizens of a particular country (with the government picking up the tab) but if anything, this impacts excludability, not rivalry. Hence, the closest classification would be as a common-pool resource. --Classicalecon (talk) 01:37, 31 July 2010 (UTC)