Voluntary provision of public goods and technology

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Publisher: Springer
Document Type: Article
Length: 5,976 words
Lexile Measure: 1530L

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Abstract This paper highlights issues in the theory of voluntary provision of public goods, building on the investigation by Peacock in connection with the contributions by Coase and Buchanan. Our goal is twofold. We first draw attention to the early literature investigating the provision of public goods and to the successive theoretical analysis. We then focus on the impact of technology on supply and demand. Examples of different types of public goods are provided, with special attention to the cultural sector, to investigate whether and how technology affects the efficiency and the effectiveness of the related public goods provision. The implementation and exploitation of technological advancements are investigated in view of the role of different actors (public, private) at different levels of government.

Keywords Public goods * Buchanan * Coase * Peacock * technology ? cultural sector JEL Classification H41 * 033 * Z10

Introduction

This paper investigates some theoretical issues on voluntary cooperation for the provision of public goods, building on the early investigation by Alan Peacock. The paper will also analyse this topic with other contributions from the same period by Coase and Buchanan regarding the impact of externalities and transaction costs on private decisions and market solutions, and the optimal range and dimension of public goods provision. The goal of our study is to draw attention to common aspects of the early literature investigating the provision of public goods and to focus on the fundamental impact that the development of new technologies may have in shaping demand and supply. Special attention will be devoted to the cultural sector, in order to investigate whether and how new technologies affect the efficiency and the effectiveness of the related public goods provision and whether substitution or complementarity effects occur. Moreover, the implementation and exploitation of technological advancements will be investigated in view of the role of different actors (public, private).

Buchanan and the Theory of Impure Public Goods

The publication of Paul Samuelson's seminal paper "The Pure Theory of Public Expenditures" in 1954 initiated an extensive debate among scholars. James M. Buchanan had a prominent role in that discussion from different perspectives. Firstly, he offers a generalization of Samuelson's concept of "pure" public goods. Samuelson builds his theory on the concept of public goods (or services) having "inseparability," which implies "non-rivalness" and "non-excludability." Perfectly private goods are the opposite of public goods when it comes to consumption goods.

Buchanan (1966, 1967, 1968) provides an important generalisation of the theory by analysing the intermediate cases of partially public goods. Buchanan distinguishes between availability of a public good and accessibility to the flows of services deriving from that good. This distinction is interpreted in terms of joint supply. The fact that all can consume a public good does not imply that all enjoy an equal flow of services measured along some physical dimension. Similarly to private goods jointly produced, one unit of public good at the production stage does not correspond to one unit of the same good at the consumption stage....

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Gale Document Number: GALE|A463755602