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The Market Provision of Club Goods


  • Peter W. Kennedy


Existing models of the efficiency of the market in providing club goods have failed to fully recognize the dependence of their results on the nature of the technology assumed. In this paper, optimality conditions for club goods provision, membership, and visitation are determined for a technology which allows for the possibility of both internal and external economies of scale. The integer problem associated with these conditions is discussed, and an efficient solution is derived in a two-stage problem. A general model of market provision is constructed which can accommodate a range of market structures. The efficiency of market provision is then assessed under perfect competition, oligopoly, and natural monopoly.

Suggested Citation

  • Peter W. Kennedy, 1988. "The Market Provision of Club Goods," Working Papers 732, Queen's University, Department of Economics.
  • Handle: RePEc:qed:wpaper:732

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