Lec17_F03_mine - CLASS#17 THEORY PUBLIC GOODS MODEL COST/BENEFIT I Social Context of Goods A Common Situation 1 People Desire Goods 2 Goods are

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CLASS #17: THEORY: PUBLIC GOODS / MODEL: COST/BENEFIT a. Social Context of Goods B. Common Situation 1. People Desire Goods 2. Goods are Scarce 3. Must be Allocated 4. Allocation Must be Authoritative C. Ability to Allocate Authoritatively 1. Consumption Characteristics 2. Production Characteristics a. Consumption Characteristics D. Excludability -- is it feasible to keep someone from consuming the good once it is produced? 1. Feasible – 2. Non-Feasible E. Supply 1. Individual – if a good is perfectly divisible, it can be supplied in any quantities to any mix of people 2. Jointly Supplied – if a good is available for consumption at all by any members of a group, it is available for consumption in equal measure by all members of the group. a. Production Characteristics F. Independent Production – many desires can be fulfilled by an individual acting in total isolation from all others G. Jointness of Production – there are objects of desire that can only be realized by large groups of people acting in concert, even if each individual possesses huge resources. a. Typology of Goods H. Private Consumption/Private Production I. Private Consumption/Coop. Production J. Public Consumption/Private Production K. Public Consumption/Coop. Production a. Collective Action Problem L. DEFINITION: When individuals desire public goods from which they cannot
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This note was uploaded on 04/21/2008 for the course PLS 200 taught by Professor Idk during the Fall '08 term at Michigan State University.

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Lec17_F03_mine - CLASS#17 THEORY PUBLIC GOODS MODEL COST/BENEFIT I Social Context of Goods A Common Situation 1 People Desire Goods 2 Goods are

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