Pubic Goods and the Tragedy of the Commons
Slides [link]Lecture 1
Public Goods
Required Reading
- KO pages 85-99
- Read this article on NY City congestion pricing.
Response questions
- Why doesn’t the free market result in an efficient number of cars on the road in Manhattan?
- What do you think the the best solution to this problem of Manhattan traffic is? (4 sentences or less)
Additional material:
- Kwiek provides a detailed discussion of the economics of congestion pricing (on canvas)
- Hardin (1968) - one of the most widely cited papers.
- Important summary on Hardin’s disgraceful views available here. And a nice Twitter discussion of the pros and cons of teaching the TOC in light of this here
Key Points
- Taxonomy of goods
- Incentives to under supply public goods
- Tragedy of the Commons