Public Goods and
Common Resources
Chapter 11
“The best things in life are free.,,”
Free goods provide a special challenge for
economic analysis
Most goods in our economy are allocated
in markets…
…for these goods,prices are the signals
that guide the decisions of buyers and
sellers.
When goods are available free of charge,
the market forces that normally allocate
resources in our economy are absent.
When a good does not have a price
attached to it,private markets cannot
ensure that the good is produced and
consumed in the proper amounts.
In such cases,government policy can
potentially remedy the market failure that
results,and raise economic well-being.
“The best things in life are free.,,”
The Different Kinds of Goods
When thinking about the various goods in
the economy,it is useful to group them
according to two characteristics:
Is the good excludable?
Is the good rival?
Excludability
– People can be prevented from enjoying the
good.
– Laws recognize and enforce private property
rights.
Rivalness
– One person’s use of the good diminishes
another person’s enjoyment of it,
The Different Kinds of Goods
Four Types of Goods
Private Goods
– Are both excludable and rival.
Public Goods
– Are neither excludable nor rival.
Common Resources
– Are rival but not excludable.
Natural Monopolies
– Are excludable but not rival.
Types of Goods
Rival?
Yes No
Yes
Private Goods
· Ice- cream cones
·Clothing
· Congested toll roads
Natural Monopolies
· Movies
· Cable TV
· Uncongested toll
roads
No
Common Resources
· Fish in the ocean
· The environment
· Congested nontoll
roads
Public Goods
· National defense
· Knowledge
· Uncongested nontoll
roads
Excludable?
The Free-Rider Problem
A free-rider is a person who receives the
benefit of a good but avoids paying for it.
Since people cannot be excluded from
enjoying the benefits of a public good,
individuals may withhold paying for the
good hoping that others will pay for it.
The free-rider problem prevents private
markets from supplying public goods.
Solving the Free-rider Problem
The government can decide to provide the
public good if the total benefits exceed the
costs.
The government can make everyone better
off by providing the public good and
paying for it with tax revenue.
Some Important Public Goods
National Defense
Basic Research
Programs to Fight Poverty
Are Lighthouses
Public Goods?
Cost-Benefit Analysis
In order to decide whether to provide a
public good or not,the total benefits of all
those who use the good must be
compared to the costs of providing and
maintaining the public good.
Cost benefit analysis estimates the total
costs and benefits of a good to society as a
whole.
Cost-Benefit Analysis
A cost-benefit analysis would be used to
estimate the total costs and benefits of the
project to society as a whole.
It is difficult to do because of the absence
of prices needed to estimate social benefits
and resource costs.
The value of life,the consumer’s time,and
aesthetics are difficult to assess.
Common Resources
Common resources,like public goods,are
not excludable,They are available free of
charge to anyone who wishes to use them.
Common resources are rival goods
because one person’s use of the common
resource reduces other people’s use.
Tragedy of the Commons
The Tragedy of the Commons is a story
with a general lesson,When one person
uses a common resource,he or she
diminishes another person’s enjoyment of
it.
Common resources tend to be used
excessively when individuals are not
charged for their usage,
This creates a negative externality.
Examples of Common Resources
Clean air and water
Oil pools
Congested roads
Fish,whales,and other wildlife
公地悲剧：北京的道路北京早高峰时间的道路交通单位：分钟路线 交通方式数据来源起点 终点 自驾车或出租车地铁（加步行或公交） 自行车 摩托车翠宫 国贸 110 63 63 [1]
东直门 国贸 30 29 25 22 [1]
安定门 国贸 比开车快 16分钟 [1]
北师大 复兴门 72 65 45 [2]
数据来源 [1],2005年 3月 7日（周一）环保组织,自然之友,组织的志愿者活动,,北京晨报,,2005年 3月 8日。
数据来源 [2],2005年 3月 17,18日（周四、五）记者行动,,北京广播电视报,,2005年 3月 24日。
公地悲剧：野生动物
地球上曾经存在的种属中，只有 0.02％目前仍然存在。
大约在一万两千多年前，北美洲大多数量大的动物区系的灭绝与人类在此登陆有关。 24种哺乳动物与 22种鸟现已不复存在了。
对某一动物种属大量捕杀最好的例证是对蓝鲸的围捕，甚至在使用最为现代化的设备时，有时几乎重达 100吨的巨大蓝鲸也是难以被捕杀的。但是密集的捕杀方法逐渐将鲸鱼存量从大约 30万到 100万头减少到目前的 600到 3000头之间。 在 1930年至 1931年的冬季，差不多有 3万头蓝鲸被捕捉。到了 1945年至 1946年，有不到 10000头蓝鲸被捕捉；
50年代末期，年捕获量下降到 1500头。到了 1964年至 1965
年，总数仅 20头蓝鲸。
1966年国际捕鲸委员会宣布蓝鲸为禁捕的保护对象。国际捕鲸委员会 1989年发表的统计报告说，根据在南半球经过
8年的调查,蓝鲸现在只有 200～ 453头幸存者。
Why Isn’t the Cow Extinct?
Private
Ownership and
the Profit
Motive!
Solving the tragedy of Commons
Command-and-Control
Tax
License
Property Privatization
Importance of Property Rights
The market fails to allocate resources
efficiently when property rights are not
well-established (i.e,some item of value
does not have an owner with the legal
authority to control it).
When the absence of property rights
causes a market failure,the government
can potentially solve the problem.
Summary
Goods differ in whether they are
excludable and whether they are rival.
A good is excludable if it is possible to
prevent someone from using it.
A good is rival if one person’s enjoyment
of the good prevents other people from
enjoying the same unit of the good.
Summary
Public goods are neither rival nor
excludable.
Because people are not charged for their
use of public goods,they have an
incentive to free ride when the good is
provided privately.
Governments provide public goods,
making quantity decisions based upon
cost-benefit analysis.
Summary
Common resources are rival but not
excludable.
Because people are not charged for their
use of common resources,they tend to use
them excessively.
Governments tend to try to limit the use of
common resources.
Exercise #11
Problems and applications
– #3,#8
其它例子
旅鸽,数量大于 10亿尾，曾有人观察到 40英里长，三英里宽的鸽群。被认为是最不可能灭绝的动物之一。印第安人很早就开始猎杀，但真正的悲剧产生于白人登陆后将其作为食物。最后一只旅鸽的观察记录是 1914年。
座头鲸的数量,30万 ——1500头（ 1960年代）
小须鲸：在人类意识到鲸类可能灭绝以后，国际社会在 1960年代达成协议，年捕杀配额为 5000头，次年日本、苏联退出。日本宣称合适的捕杀配额是 12000头。
长江中的白鳍豚、中华鲟、江豚等濒临灭绝。
非洲野生动物的保护：一些国家（纳米比亚，博茨瓦纳，津巴布韦）允许自由猎杀私人土地上的大象，一些国家（肯尼亚、坦桑尼亚、乌干达）禁止猎杀大象或出售象牙。
印第安人有时候会采取非常残忍的围猎方式：将森林中的动物驱赶到悬崖上摔死。但是印第安人有时候也采取轮猎的方式。（什么时候可能采取轮猎方式？）
什么时候可以采取产权私有化的方式来保护野生动物？为什么？（可可西里）
北美土狼的保护：土狼本身并不在保护之列，但是猎杀土狼的有效方式（毒药）被限制了，狼群增加，养羊成本上升，羊皮（毛）价格上升，一些农场被迫关闭。
共有资源的其他例子：海洋（石油污染）。
法律、政府：穆勒著作中英国法律“凡不信仰神和彼岸的人不得在法庭作证”。
再看一眼资源的作用
2006年,Israel $26800,Saudi Arab $13800,Iran $8700,Russian,$8500,
Swiss,$ 36000 and Japan $35000
Robert Barro用 97个国家 20年的数据研究发现，自然资源越贫乏的国家经济增长速度越快。 18个最快国家中只有 2个资源丰富，其中中国的人均资源很贫乏。
经济增长中的荷兰病,1950年代荷兰在北海发现了丰富的天然气。基尔德币值上升，资源从出口行业转移到天然气行业，政府增加社会保险后雇佣工人的成本上升，这些导致荷兰的出口业持续萎缩。
经济发展的几大因素：
好的政府机构（责任心、管制负担、法治、腐败） ——更高的收入、识字率和更低的婴儿死亡率。（世界银行 150个国家的比较）
产权。
不要有过多的管制。 Robert Barro用 100个国家 30年的数据研究发现，政府开支（减去国防和教育支出）和人均 GDP显著负相关。
人力资本。（烧开水、修公厕、使用安全套）
地理位置。（只有香港和新加坡位于南北回归线之间）高温和大雨不利于食物生产而易于传染疾病。
开放贸易
负责任的财政货币政策。
民主：世界上最严重饥荒不是由于粮食减产引起的，而是由于禁止市场调节的不完善的政治制度引起的。
“在那些独立的，选举规范的，有相互批评的对立的政党的，无须过多审查就允许报纸自由报道和质疑政府政策的明智国家里，饥荒从没有成为现实” ——Amartya Sen
经济学可以更有趣
为什么我们担心鲸会灭绝而从来不担心鲫鱼会灭绝？为什么老虎会灭绝而猪不会？
为什么地中海地区的污染比美国大盐湖地区严重的多？
为什么苏联解体后里海地区的鱼子酱产量锐减？
1968年，法律禁止烟草公司做广告，限制了烟草业还是帮助了烟草业？
为什么环保主义者会去袭击穿着皮毛大衣的女性而不去袭击摩托党？
经济学可以更有趣
生物学问题：为什么雄海象比雌海象体格上大得多（雄,20多英尺长,6000多磅重，雌：
800-1200磅）？为什么是雄孔雀有长尾？为什么雄狮才长鬃毛且体格更大？
为什么信天翁雌雄体格相近？为什么狼也是雌雄体格相近？
猜测：什么样的动物会是雌性的体格更大？
为什么动物的体格没有无限增大？譬如海象。
Common Resources
Chapter 11
“The best things in life are free.,,”
Free goods provide a special challenge for
economic analysis
Most goods in our economy are allocated
in markets…
…for these goods,prices are the signals
that guide the decisions of buyers and
sellers.
When goods are available free of charge,
the market forces that normally allocate
resources in our economy are absent.
When a good does not have a price
attached to it,private markets cannot
ensure that the good is produced and
consumed in the proper amounts.
In such cases,government policy can
potentially remedy the market failure that
results,and raise economic well-being.
“The best things in life are free.,,”
The Different Kinds of Goods
When thinking about the various goods in
the economy,it is useful to group them
according to two characteristics:
Is the good excludable?
Is the good rival?
Excludability
– People can be prevented from enjoying the
good.
– Laws recognize and enforce private property
rights.
Rivalness
– One person’s use of the good diminishes
another person’s enjoyment of it,
The Different Kinds of Goods
Four Types of Goods
Private Goods
– Are both excludable and rival.
Public Goods
– Are neither excludable nor rival.
Common Resources
– Are rival but not excludable.
Natural Monopolies
– Are excludable but not rival.
Types of Goods
Rival?
Yes No
Yes
Private Goods
· Ice- cream cones
·Clothing
· Congested toll roads
Natural Monopolies
· Movies
· Cable TV
· Uncongested toll
roads
No
Common Resources
· Fish in the ocean
· The environment
· Congested nontoll
roads
Public Goods
· National defense
· Knowledge
· Uncongested nontoll
roads
Excludable?
The Free-Rider Problem
A free-rider is a person who receives the
benefit of a good but avoids paying for it.
Since people cannot be excluded from
enjoying the benefits of a public good,
individuals may withhold paying for the
good hoping that others will pay for it.
The free-rider problem prevents private
markets from supplying public goods.
Solving the Free-rider Problem
The government can decide to provide the
public good if the total benefits exceed the
costs.
The government can make everyone better
off by providing the public good and
paying for it with tax revenue.
Some Important Public Goods
National Defense
Basic Research
Programs to Fight Poverty
Are Lighthouses
Public Goods?
Cost-Benefit Analysis
In order to decide whether to provide a
public good or not,the total benefits of all
those who use the good must be
compared to the costs of providing and
maintaining the public good.
Cost benefit analysis estimates the total
costs and benefits of a good to society as a
whole.
Cost-Benefit Analysis
A cost-benefit analysis would be used to
estimate the total costs and benefits of the
project to society as a whole.
It is difficult to do because of the absence
of prices needed to estimate social benefits
and resource costs.
The value of life,the consumer’s time,and
aesthetics are difficult to assess.
Common Resources
Common resources,like public goods,are
not excludable,They are available free of
charge to anyone who wishes to use them.
Common resources are rival goods
because one person’s use of the common
resource reduces other people’s use.
Tragedy of the Commons
The Tragedy of the Commons is a story
with a general lesson,When one person
uses a common resource,he or she
diminishes another person’s enjoyment of
it.
Common resources tend to be used
excessively when individuals are not
charged for their usage,
This creates a negative externality.
Examples of Common Resources
Clean air and water
Oil pools
Congested roads
Fish,whales,and other wildlife
公地悲剧：北京的道路北京早高峰时间的道路交通单位：分钟路线 交通方式数据来源起点 终点 自驾车或出租车地铁（加步行或公交） 自行车 摩托车翠宫 国贸 110 63 63 [1]
东直门 国贸 30 29 25 22 [1]
安定门 国贸 比开车快 16分钟 [1]
北师大 复兴门 72 65 45 [2]
数据来源 [1],2005年 3月 7日（周一）环保组织,自然之友,组织的志愿者活动,,北京晨报,,2005年 3月 8日。
数据来源 [2],2005年 3月 17,18日（周四、五）记者行动,,北京广播电视报,,2005年 3月 24日。
公地悲剧：野生动物
地球上曾经存在的种属中，只有 0.02％目前仍然存在。
大约在一万两千多年前，北美洲大多数量大的动物区系的灭绝与人类在此登陆有关。 24种哺乳动物与 22种鸟现已不复存在了。
对某一动物种属大量捕杀最好的例证是对蓝鲸的围捕，甚至在使用最为现代化的设备时，有时几乎重达 100吨的巨大蓝鲸也是难以被捕杀的。但是密集的捕杀方法逐渐将鲸鱼存量从大约 30万到 100万头减少到目前的 600到 3000头之间。 在 1930年至 1931年的冬季，差不多有 3万头蓝鲸被捕捉。到了 1945年至 1946年，有不到 10000头蓝鲸被捕捉；
50年代末期，年捕获量下降到 1500头。到了 1964年至 1965
年，总数仅 20头蓝鲸。
1966年国际捕鲸委员会宣布蓝鲸为禁捕的保护对象。国际捕鲸委员会 1989年发表的统计报告说，根据在南半球经过
8年的调查,蓝鲸现在只有 200～ 453头幸存者。
Why Isn’t the Cow Extinct?
Private
Ownership and
the Profit
Motive!
Solving the tragedy of Commons
Command-and-Control
Tax
License
Property Privatization
Importance of Property Rights
The market fails to allocate resources
efficiently when property rights are not
well-established (i.e,some item of value
does not have an owner with the legal
authority to control it).
When the absence of property rights
causes a market failure,the government
can potentially solve the problem.
Summary
Goods differ in whether they are
excludable and whether they are rival.
A good is excludable if it is possible to
prevent someone from using it.
A good is rival if one person’s enjoyment
of the good prevents other people from
enjoying the same unit of the good.
Summary
Public goods are neither rival nor
excludable.
Because people are not charged for their
use of public goods,they have an
incentive to free ride when the good is
provided privately.
Governments provide public goods,
making quantity decisions based upon
cost-benefit analysis.
Summary
Common resources are rival but not
excludable.
Because people are not charged for their
use of common resources,they tend to use
them excessively.
Governments tend to try to limit the use of
common resources.
Exercise #11
Problems and applications
– #3,#8
其它例子
旅鸽,数量大于 10亿尾，曾有人观察到 40英里长，三英里宽的鸽群。被认为是最不可能灭绝的动物之一。印第安人很早就开始猎杀，但真正的悲剧产生于白人登陆后将其作为食物。最后一只旅鸽的观察记录是 1914年。
座头鲸的数量,30万 ——1500头（ 1960年代）
小须鲸：在人类意识到鲸类可能灭绝以后，国际社会在 1960年代达成协议，年捕杀配额为 5000头，次年日本、苏联退出。日本宣称合适的捕杀配额是 12000头。
长江中的白鳍豚、中华鲟、江豚等濒临灭绝。
非洲野生动物的保护：一些国家（纳米比亚，博茨瓦纳，津巴布韦）允许自由猎杀私人土地上的大象，一些国家（肯尼亚、坦桑尼亚、乌干达）禁止猎杀大象或出售象牙。
印第安人有时候会采取非常残忍的围猎方式：将森林中的动物驱赶到悬崖上摔死。但是印第安人有时候也采取轮猎的方式。（什么时候可能采取轮猎方式？）
什么时候可以采取产权私有化的方式来保护野生动物？为什么？（可可西里）
北美土狼的保护：土狼本身并不在保护之列，但是猎杀土狼的有效方式（毒药）被限制了，狼群增加，养羊成本上升，羊皮（毛）价格上升，一些农场被迫关闭。
共有资源的其他例子：海洋（石油污染）。
法律、政府：穆勒著作中英国法律“凡不信仰神和彼岸的人不得在法庭作证”。
再看一眼资源的作用
2006年,Israel $26800,Saudi Arab $13800,Iran $8700,Russian,$8500,
Swiss,$ 36000 and Japan $35000
Robert Barro用 97个国家 20年的数据研究发现，自然资源越贫乏的国家经济增长速度越快。 18个最快国家中只有 2个资源丰富，其中中国的人均资源很贫乏。
经济增长中的荷兰病,1950年代荷兰在北海发现了丰富的天然气。基尔德币值上升，资源从出口行业转移到天然气行业，政府增加社会保险后雇佣工人的成本上升，这些导致荷兰的出口业持续萎缩。
经济发展的几大因素：
好的政府机构（责任心、管制负担、法治、腐败） ——更高的收入、识字率和更低的婴儿死亡率。（世界银行 150个国家的比较）
产权。
不要有过多的管制。 Robert Barro用 100个国家 30年的数据研究发现，政府开支（减去国防和教育支出）和人均 GDP显著负相关。
人力资本。（烧开水、修公厕、使用安全套）
地理位置。（只有香港和新加坡位于南北回归线之间）高温和大雨不利于食物生产而易于传染疾病。
开放贸易
负责任的财政货币政策。
民主：世界上最严重饥荒不是由于粮食减产引起的，而是由于禁止市场调节的不完善的政治制度引起的。
“在那些独立的，选举规范的，有相互批评的对立的政党的，无须过多审查就允许报纸自由报道和质疑政府政策的明智国家里，饥荒从没有成为现实” ——Amartya Sen
经济学可以更有趣
为什么我们担心鲸会灭绝而从来不担心鲫鱼会灭绝？为什么老虎会灭绝而猪不会？
为什么地中海地区的污染比美国大盐湖地区严重的多？
为什么苏联解体后里海地区的鱼子酱产量锐减？
1968年，法律禁止烟草公司做广告，限制了烟草业还是帮助了烟草业？
为什么环保主义者会去袭击穿着皮毛大衣的女性而不去袭击摩托党？
经济学可以更有趣
生物学问题：为什么雄海象比雌海象体格上大得多（雄,20多英尺长,6000多磅重，雌：
800-1200磅）？为什么是雄孔雀有长尾？为什么雄狮才长鬃毛且体格更大？
为什么信天翁雌雄体格相近？为什么狼也是雌雄体格相近？
猜测：什么样的动物会是雌性的体格更大？
为什么动物的体格没有无限增大？譬如海象。
