Summary
This paper has taken the mixed product, examined its components, and, on the basis of private-public characteristics, defined four categories. These four categories of products have been analyzed through the use of an altered version of the Cicchetti and Smith graphical device. Through this analysis the effects of changes in the various demand components have been isolated. Thus, revised market equilibria have been determined giving indications of social cost or benefit and private cost/benefit.
The analytical tool posited here may prove to be useful in isolating the source of externalities. Of course only one side of the market has been analyzed—supply has been passive. But, by now the interested reader should be able to make further adjustments for himself and thereby test the model's reaction to other combinations of change.
Policy implications of the analysis have only been alluded to in passing. Thus, there is another work to be done in relating taxes, subsidies, charges, quotas, and property rights to the analysis here.
In any event it is hoped that this analysis offers something for the world which is not all “bad” and for the world which is.
Keywords
Analytical Tool Public Finance Interested Reader Policy Implication Social CostPreview
Unable to display preview. Download preview PDF.
References
- Bish, Robert L. and O'Donoghue, Patrick D., “A Neglected Problem in Public Goods Theory: The Monopsony Problem.”Jour. Pol. Econ. 78, No. 6 (November/December 1970), 1367–1371.Google Scholar
- Buchanan, James M., “An Economic Theory of Clubs,”Economica (February 1965), 1–14Google Scholar
- ——,The Demand and Supply of Public Goods. Chicago: Rand McNally, 1968.Google Scholar
- Cicchetti, Charles J. and Smith, V. Kerry, “A Note on Jointly Supplied Mixed Goods,”Quart. Rev. of Econ. and Bus. 10, No. 3 (Autumn 1970), 90–94.Google Scholar
- ——, “Jointly Supplied Mixed Goods: Reply,”Quart. Rev. of Econ. and Bus. 12, No. 4 (Winter 1972), 95–97.Google Scholar
- Davis, Otto A. and Whinston, Andrew B., “Some Notes on Equating Private and Social Cost,”So. Econ. Jour. 32, No. 2 (October 1965), 113–126.Google Scholar
- --, “On the Distinction Between Private and Public Goods,”Am. Econ. Rev., 57, No. 2 (May 1967), 360-ff.Google Scholar
- Hulett, Joe R., “Jointly Supplied Mixed Goods: Comment,”Quart. Rev. of Econ. and Bus., 12, No. 4 (Winter 1972), 94–96.Google Scholar
- Musgrave, Richard A.,The Theory of Public Finance New York: McGraw-Hill Book Company, 1959.Google Scholar