Economics Dictionary of ArgumentsHome
| |||
|
| |||
| Collective goods: Collective goods, or public goods, in economics are goods that are non-excludable and non-rivalrous, meaning they can be used by everyone without reducing availability to others.. These goods often require government provision or regulation due to challenges in private market supply and free-rider issues. See also Free-rider, Non-rivalty._____________Annotation: The above characterizations of concepts are neither definitions nor exhausting presentations of problems related to them. Instead, they are intended to give a short introduction to the contributions below. – Lexicon of Arguments. | |||
| Author | Concept | Summary/Quotes | Sources |
|---|---|---|---|
|
Economic Theories on Collective Goods - Dictionary of Arguments
Rothbard III 1030 Collective goods/Economic theories/Rothbard: Many attempts have been made (…), to salvage the concept of the "collective" good, to provide a seemingly ironclad, scientific justification for government operations. Molinari: Molinari, for example, trying to establish defense as a collective good, asserted: "A police force serves every inhabitant of the district in which it acts, but the mere establishment of a bakery does not appease their hunger." RothbardVsMolinari: But, on the contrary, there is no absolute necessity for a police force to defend every inhabitant of an area or, still more, to give each one the same degree of protection. Furthermore, an absolute pacifist, a believer in total nonviolence, living in the area, would not consider himself protected by, or receiving defense service from, the police. On the contrary, he would consider any police in his area a detriment to him. Hence, defense cannot be considered a "collective good" or "collective want." Similarly for such projects as dams, which cannot be simply assumed to benefit everyone in the area.(1) De Viti De Marco: Antonio De Viti De Marco defined "collective wants" as consisting of two categories: a) wants arising when an individual is not in isolation and b) wants connected with a conflict of interest. RothbardVsDe Viti De Marco: Vs a) The first category, however, is so broad as to encompass most market products. There would be no point, for example, in putting on plays unless a certain number went to see them or in publishing newspapers without a certain wide market. Must all these industries therefore be nationalized and monopolized by the government? Vs b) The second category is presumably meant to apply to defense. This, however, is incorrect. Defense, itself, does not reflect a conflict of interest, but a threat of invasion, against which defense is needed. Furthermore, it is hardly sensible to call "collective" that want which is precisely the least likely to be unanimous, since robbers will hardly desire it!(2) Immaterial goods/service: Other economists write as if defense is necessarily collective because it is an immaterial service, whereas bread, autos, etc., are materially divisible and salable to individuals. RothbardVs: But "immaterial" services to individuals abound in the market. Must concert-giving be monopolized by the state because its services are immaterial? Rothbard III 1031 Samuelson: In recent years, Professor Samuelson has offered his own definition of "collective consumption goods," in a so-called "pure" theory of government expenditures. Def Collective consumption goods/Samuelson: Collective consumption goodss according to Samuelson, are those "which all enjoy in common in the sense that each individual's consumption of such a good leads to no subtraction from any other individual's consumption of that good." For some reason, these are supposed to be the proper goods (or at least these) for government, rather than the free market, to provide.(3) VsSamuelson: Samuelson's category has been attacked with due severity. Professor Enke(4), for example, pointed out that most governmental services simply do not fit Samuelson's classification - including highways, libraries, judicial services, police, fire, hospitals, and military protection. In fact, we may go further and state that no goods would ever fit into Samuelson's category of "collective consumption goods." Margolis: [Julius] Margolis(4), for example, while critical of Samuelson, concedes the inclusion of national defense and lighthouses in this category. But "national defense" is surely not an absolute good with only one unit of supply. It consists of specific resources committed in certain definite and concrete ways - and these resources are necessarily scarce. A ring of defense bases around New York, for example, cuts down the amount possibly available around San Francisco. Furthermore, a lighthouse shines over a certain fixed area only. Not only does a ship within the area prevent others from entering the area at the same time, but also the construction of a lighthouse in one Place limits its construction elsewhere. In fact, if a good is really technologically "collective" in Samuelson's sense, it is not a good at all, but a natural condition of human welfare, like air - superabundant to all, and therefore unowned by anyone. Indeed, it is not the lighthouse, but the ocean itself—when the Ianes are not crowded - which is the "collective consumption good," and which therefore remains unowned. Obviously, neither government nor anyone else is normally needed to produce or allocate the ocean.(4) Rothbard III 1032 Tiebout: Charles M. Tiebout(5), conceding that there is no "pure" way to establish an optimum level for government expenditures, tries to salvage such a theory specifically for local government. Realizing that the taxing, and even voting, process precludes voluntary demonstration of consumer choice in the governmental field, he argues that decentralization and freedom of internal migration renders local government expenditures more or less optimal - as we can say that free market expenditures by firms are "optimal"—since the residents can move in and out as they please. Certainly, it is true that the consumer will be better off if he can move readily out of a high-tax, and into a Iow tax, community. But this helps the consumer only to a degree; it does not solve the problem of government expenditures, which remains otherwise the same. There are, indeed, other factors than government entering into a man's choice of residence, and enough People may be attached to a certain geographical area, for one reason or another, to permit a great deal of government depredation before they move. Furthermore, a major problem is that the world's total land area is fixed, and that governments have universally pre-empted all the land and thus universally burden consumers.(5) >Collective goods/Rothbard, >Social goods. 1. Gustave de Molinari, The Society of Tomorrow. New York: G.P. Putnam's Sons, 1904. Reprinted by Taylor & Francis, 1972. p. 63. On the fallacy of collective goods, see S.R., Ibid., p. 63. On the fallacy of collective goods, see S.R., "Spencer As His Own Critic," Liberty, June, 1904, and Merlin H. Hunter and Harry K. Allen, Principles of Public Finance (New York: Harpers, 1940), p. 22. Molinari had not always believed in the existence of "collective goods," as can be seen from his remarkable "De la production de la sécurité," Journal des Economistes, February 15, 1849 , and Molinari, "Onziéme soirée" in Les soirées de la Rue Saint Lazare (Paris, 1849). 2. Antonio De Viti De Marco, First Principles of Public Finance (London: Jonathan Cape, 1936), pp. 37-41. Similar to De Viti's first category is Baumol's attempted criterion of "jointly" financed goods, for a critique of which see Rothbard, "Toward A Reconstruction of Utility and Welfare Economics," pp. 255-60. 3. Paul A. Samuelson, "The Pure Theory of Public Expenditures," Review ofEconomics and statistics, November, 1954, pp. 387-89. 4. Stephen Enke, "More on the Misuse of Mathematics in Economics: A Rejoinder," Review of Economics and statistics, May, 1955, pp. 131-33 ; Julius Margolis, "A Comment On the Pure Theory of Public Expenditures," Review of Economics and statistics, November, 19 5 5, pp. 347-49. In his reply to critics, Samuelson, after hastening to deny any possible implication that he wished to confine the sphere of government to collective goods alone, asserts that his category is really a "polar" concept. Goods in the real world are supposed to be only blends of the "polar extremes" of public and private goods. But these concepts, even in Samuelson's own erms, are decidedly not polar, but exhaustive. Either A's consumption of a good diminishes B's possible consumption, or it does not: these two alternatives are mutually exclusive and exhaust the possibilities. In effect, Samuelson has abandoned his category either as a theoretical or as a practical device. Paul A. Samuelson, "Diagrammatic Exposition of a Theory of Public Expenditure," Review of Economics and statistics, November, 1955, pp. 350-56. 5. Charles M. Tiebout, "A Pure Theory of Local Expenditures," Journal of Political Economy, October, 1956, pp. 416 - 24. At one point, Tiebout seems to admit that his theory would be valid only if each person could somehow be "his own municipal government." Ibid., p. 421. In the course of an acute critique of the idea of competition in government, the Colorado Springs Gazette-Telegraph wrote as follows: „Were the taxpayer free to act as a customer, buying only those services he deemed useful to himself and which were priced within his reach, then this competition between governments would be a wonderful thing. But because the taxpayer is not a customer, but only the governed, he is not free to choose. He is only compelled to pay.... With government there is no producer-customer relationship. There is only the relation that always exists between those who rule and those who are ruled. The ruled are never free to refuse the services of the products of the ruler.... Instead of trying to see which government could best serve the governed, each government began to vie with every other government on the basis of its tax collections.... The victim of this competition is always the taxpayer.... The taxpayer is now set upon by the federal, state, school board, county and City governments. Each of these is competing for the last dollar he has.“ (Colorado Springs Gazette-Telegraph, July 16, 1958)_____________Explanation of symbols: Roman numerals indicate the source, arabic numerals indicate the page number. The corresponding books are indicated on the right hand side. ((s)…): Comment by the sender of the contribution. Translations: Dictionary of Arguments The note [Concept/Author], [Author1]Vs[Author2] or [Author]Vs[term] resp. "problem:"/"solution:", "old:"/"new:" and "thesis:" is an addition from the Dictionary of Arguments. If a German edition is specified, the page numbers refer to this edition. |
Economic Theories Rothbard II Murray N. Rothbard Classical Economics. An Austrian Perspective on the History of Economic Thought. Cheltenham, UK: Edward Elgar Publishing. Cheltenham 1995 Rothbard III Murray N. Rothbard Man, Economy and State with Power and Market. Study Edition Auburn, Alabama 1962, 1970, 2009 Rothbard IV Murray N. Rothbard The Essential von Mises Auburn, Alabama 1988 Rothbard V Murray N. Rothbard Power and Market: Government and the Economy Kansas City 1977 |
||
> Counter arguments against Economic Theories
> Counter arguments in relation to Collective Goods
Authors A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
Concepts A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
