8Lecture

8Lecture - Lecture 8 Public Goods Fields Chapter 15 good...

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Lecture 8 Public Goods 14:42 Fields Chapter 1-5 good resource for exam Public goods – goods or services hat can be consumed by serveral individuals  simultaneously Non-rivalry: Multiple individuals can consume the same good without diminishing its  value Non-excludability: An individual cannot be prevented from consuming the good Examples: Fresh air, a public park, a beautiful view, national defense Marginal Willingness to pay ($ per year) Level of  Contaminant  (ppm) Home  Owner ! Home  Owner B Home  owner C Aggregate  MWP MC of  Cleanup 4 110 60 30 200 50 3 85 35 20 140 65 2 70 10 15 95 95 1 55 0 65 150 0 45 0 5 50 240
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Aggregate willingness to pay for a public good With a public good household are consuming the same good, so we add the household  marginal willingness to pay at each quantity to get the aggregate demand function Property Rights and the Environment Property rights define entitlement that cannot be taken away Pulluters may have rights to pollute o Precedent establishes righs in many cases o A chemical plant gets the rights to pollute when a plant is established
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8Lecture - Lecture 8 Public Goods Fields Chapter 15 good...

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