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The Voluntary (Private) Production of Public Goods, the Gains from Trade, and Comparative Advantage

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  • Schweinberger, Albert G

Abstract

Any (finite) number of privately produced public goods are incorporated into a general trade-theory model of private goods and factors. Postulating Cournot-Nash behavior, a necessary condition for gainful trade is derived. Potential trade gains are related to the law of comparative advantage in private goods and the change in the underproduction of public goods. A sufficient condition is also proven. Trade gains/losses are compared for more or less populous economies. All the results have analogues in the literature on imperfect competition and/or increasing returns to scale. Copyright 1995 by Blackwell Publishing Ltd.

Suggested Citation

  • Schweinberger, Albert G, 1995. "The Voluntary (Private) Production of Public Goods, the Gains from Trade, and Comparative Advantage," Review of International Economics, Wiley Blackwell, vol. 3(2), pages 127-140, June.
    • Handle: RePEc:bla:reviec:v:3:y:1995:i:2:p:127-40
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    Cited by:

    1. Lahiri, Sajal & Raimondos-Moller, Pascalis, 1998. "Public good provision and the welfare effects of indirect tax harmonisation," Journal of Public Economics, Elsevier, vol. 67(2), pages 253-267, February.

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