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The Private Provision of Public Goods: A Note on the Demsetz Model

Author

Listed:
  • Joe R. Hulett

    (Continental Oil Company Stamford, Connecticut)

  • Robert B. Eke Lund Jr.
  • W. Mark Crain

Abstract

In this paper, the authors examine some important unsettled issues in the theory of public goods supply. In particular, certain conclusions and inferences drawn by Professor Demsetz from his “competitive†model of public goods provision are critically examined. First, the equilibrium implications of the Demsetz model are shown to be contingent upon the adoption of a nonstandard concept of competition; second, Demsetz's attempt to apply the joint supply model by analogy to the production of TV programs is challenged; and third, the argument that the private provision of public goods will produce allocative efficiency even if consumers engage in “fraudulent behavior†is shown to contain a serious flaw.

Suggested Citation

  • Joe R. Hulett & Robert B. Eke Lund Jr. & W. Mark Crain, 1976. "The Private Provision of Public Goods: A Note on the Demsetz Model," Public Finance Review, , vol. 4(1), pages 45-55, January.
    • Handle: RePEc:sae:pubfin:v:4:y:1976:i:1:p:45-55
    DOI: 10.1177/109114217600400104
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    References listed on IDEAS

    as
    1. De Vany, Arthur S, 1975. "Capacity Utilization under Alternative Regulatory Restraints: An Analysis of Taxi Markets," Journal of Political Economy, University of Chicago Press, vol. 83(1), pages 83-94, February.
    2. Thompson, Earl A, 1973. "The Private Production of Public Goods: Comment," Journal of Law and Economics, University of Chicago Press, vol. 16(2), pages 407-412, October.
    3. Kelvin J. Lancaster, 1966. "A New Approach to Consumer Theory," Journal of Political Economy, University of Chicago Press, vol. 74, pages 132-132.
    4. Demsetz, Harold, 1970. "The Private Production of Public Goods," Journal of Law and Economics, University of Chicago Press, vol. 13(2), pages 293-306, October.
    5. Ekelund, Robert B, Jr & Hulett, Joe R, 1973. "Joint Supply, the Taussig-Pigou Controversy, and the Competitive Provision of Public Goods," Journal of Law and Economics, University of Chicago Press, vol. 16(2), pages 369-387, October.
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    Cited by:

    1. Endres, Alfred, 1978. "Fraudulence and the competitive supply of public goods," Discussion Papers, Series B 1, University of Konstanz, Department of Economics.

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