The Theory Of Externalities And Public Goods

This book presents an updated and expanded discussion of theoretical treatment of externalities (i.e. uncompensated interdependencies), public goods, and club goods.

This state-of-the art collection of papers analyses various aspects of the theory of externalities and public goods. The contributions employ new analytical techniques like the aggregative game approach, and discuss the philosophical underpinnings of the theory. Furthermore, they highlight a range of topical empirical applications including climate policy and counterterrorism. This contributed volume was written in memory of Richard C. Cornes, a pioneer in the theory of externalities and public goods.

Assertions of market failure are usually based on Paul Samuelson's theory of public goods and externalities. This book both develops that theory and challenges the conclusion of many economists and policy-makers that market failures cannot be corrected by market forces. The volume includes major case studies of private provision of public goods. Among the goods considered are lighthouse services, education, municipal services, and environmental conservation.

Theory and Measurement of Economic Externalities provides information on some analytical and empirical developments in the field of externalities. This book presents the function of turning out producer's goods in the form of better knowledge, analytical formulation, and approaches for application to current problems. Organized into five parts encompassing 12 chapters, this book begins with an overview of the notion of externalities in connection with analyses of economic welfare. This text then discusses the relationship between publicness and external diseconomies when either consumption or production or decision sets are nonconvex due to a high degree of externalities. Other chapters consider disproving the pessimistic conclusions concerning tax–subsidy schemes. This book discusses as well the solutions for the allocation of resources in an economy with public goods and interdependent preferences. The final chapter deals with a general framework for estimating externality production functions. This book is a valuable resource for economists.

In his foreword, Geoffrey Brennan states, "The papers in this volume represent a coherent set of pieces focused on aspects of public-expenditure theory and constitute all of Buchanan’s papers in this area.” Buchanan’s work on the subject of what governments should do and his insistence on Knut Wicksell’s ideal that taxation and public expenditure be integrated topics have contributed significantly to the current thinking of most economists on the topic. Geoffrey Brennan summarizes Buchanan’s central themes in this way, "There are two messages that emerge from this work: one is that a proper sense of the extent of market failure, rather than its mere presence, is relevant in all cases; the other is that 'correcting’ for such market failure is often a complex multidimensional business not captured by direct public provision at zero price and not necessarily involving expansion of market output.” The twenty-nine papers represented in this volume are grouped into these major subject categories: 1.Public Services and Collective Action 2.Externalities 3.Clubs and Joint Supply 4.Public Goods Theory 5.Applications--City, Health, and Social Security 6.Distributive Norms and Collective Action This volume also includes what are arguably Buchanan’s two most famous articles: "Externality,” which he wrote with William Stubblebine, and "Economic Theory of Clubs.” James M. Buchanan is an eminent economist who won the Alfred Nobel Memorial Prize in Economic Sciences in 1986 and is considered one of the greatest scholars of liberty in the twentieth century. ERRATA Unfortunately, after this book had been printed and bound, it was discovered that, due to a production error, the index contained some erroneous page numbers. Please click on the pdf file below to obtain the corrected index that should replace the index bound into the back of the book. When this volume goes back to press for a second printing, the index will be updated with the pages in this pdf file, and we will be pleased to send all buyers of the erroneous Volume 15 a corrected copy of the book at no extra charge. Click here for a pdf file of the corrected index. The entire series will include: Volume 1: The Logical Foundations of Constitutional Liberty Volume 2: Public Principles of Public Debt Volume 3: The Calculus of Consent Volume 4: Public Finance in Democratic Process Volume 5: The Demand and Supply of Public Goods Volume 6: Cost and Choice Volume 7: The Limits of Liberty Volume 8: Democracy in Deficit Volume 9: The Power to Tax Volume 10: The Reason of Rules Volume 11: Politics by Principle, Not Interest Volume 12: Economic Inquiry and Its Logic Volume 13: Politics as Public Choice Volume 14: Debt and Taxes Volume 15: Externalities and Public Expenditure Theory Volume 16: Choice, Contract, and Constitutions Volume 17: Moral Science and Moral Order

Public-goods theory constituted a major element in James M. Buchanan’s research agenda throughout the 1960s. The Demand and Supply of Public Goods is a major part of that work. At the time that Buchanan was elaborating on his theories of public goods, the prevailing trend in public economics was the emergence of public-expenditure theory, which attempted to form a comprehensive theory of the state around the notion of market failure. The Demand and Supply of Public Goods established Buchanan’s broad purpose of explicitly comparing market performance with political performance. As such, the book is an important part of Buchanan’s contractarian theory of the "productive state.” Conceived originally as a series of lectures given at Cambridge University in 1961 and 1962, The Demand and Supply of Public Goods is written for students, but is in no way a textbook of dry pedagogy. Instead, as Geoffrey Brennan writes in the foreword, "What Buchanan provides here is a clear statement of the contractarian approach to public goods problems, very much in the 'voluntary exchange’ tradition of Wicksell and Lindhal.” James M. Buchanan is an eminent economist who won the Alfred Nobel Memorial Prize in Economic Sciences in 1986 and is considered one of the greatest scholars of liberty in the twentieth century. The entire series will include: Volume 1: The Logical Foundations of Constitutional Liberty Volume 2: Public Principles of Public Debt Volume 3: The Calculus of Consent Volume 4: Public Finance in Democratic Process Volume 5: The Demand and Supply of Public Goods Volume 6: Cost and Choice Volume 7: The Limits of Liberty Volume 8: Democracy in Deficit Volume 9: The Power to Tax Volume 10: The Reason of Rules Volume 11: Politics by Principle, Not Interest Volume 12: Economic Inquiry and Its Logic Volume 13: Politics as Public Choice Volume 14: Debt and Taxes Volume 15: Externalities and Public Expenditure Theory Volume 16: Choice, Contract, and Constitutions Volume 17: Moral Science and Moral Order Volume 18: Federalism, Liberty, and the Law Volume 19: Ideas, Persons, and Events Volume 20: Indexes

A wide-ranging survey of the theory and evidence on public goods, presenting the main literature on public goods, both theoretical and empirical, in a systematic manner. The breadth and depth of the book's coverage extends the existing literature in many ways.

The book features Professor Tullock s normal array of insights and gems of wisdom throughout. The thesis of the book, to view government through the prism of externalities, is intriguing and makes the book well worth reading. Daniel Sutter, Public Choice The book can be commended for introducing a broad range of thought-provoking ideas in an accessible form. It is an easy read, but does not achieve (nor does it aspire to) the usual standards of academic rigour. It is in places retrospective and in others polemical. But all of it is entertaining. Gareth Myles, Economica The book offers a nice introduction into public choice but still has enough in it to keep more advanced scholars interested. Well worth reading for anyone with even a modicum of interest in economics and/or politics in the most non-partisan sense. Phong Ngo, Economic Record Tullock provides a readable account of public choice economics and the problems with collective decision making. . . Highly recommended. M. Steckbeck, Choice Gordon Tullock, eminent political economist and one of the founders of public choice, offers this new and fascinating look at how governments and externalities are linked. Economists frequently justify government as dealing with externalities, defined as benefits or costs that are generated as the result of an economic activity, but that do not accrue directly to those involved in the activity. In this original work, Gordon Tullock posits that government can also create externalities. In doing so, he looks at governmental activity that internalizes such externalities. Monarchical governments originally introduced, for the benefit of the monarch rather than to eliminate externalities, many standard government activities such as road building, war, and internal policing. Most modern governments spend more money on redistribution than on more traditional government activities. This can be thought of as another effort to reduce externalities, since suffering in the community imposes externalities on the rest of us. Rent seeking, a relatively new field in economics and political science, is closely related to externalities and to the structure of government. An analysis of rent seeking, as well as some suggestions for improving government structure, cap off this fascinating treatise. Economists and political scientists will find this lively and readable book both stimulating and provocative.