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Public GoBs

Author

Listed:
  • Daniel Heyen
  • Alessandro Tavoni

Abstract

GoBs are goods for which agents have non-monotonic preferences: more is beneficial only up to an ideal level, beyond which additional quantities become undesirable. We analyze public GoBs (non-excludable and non-rival) through a theoretical framework applicable to diverse contexts such as solar geoengineering, wildlife management, and defense spending of European countries. The private provision of public GoBs proves inefficient due to both free-rider and free-driver externalities. Contribution costs and heterogeneity in ideal levels determine equilibrium outcomes. Surprisingly, reducing contribution costs can decrease welfare when agents' preferences diverge significantly.

Suggested Citation

  • Daniel Heyen & Alessandro Tavoni, 2025. "Public GoBs," CESifo Working Paper Series 11736, CESifo.
    • Handle: RePEc:ces:ceswps:_11736
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    File URL: https://www.cesifo.org/DocDL/cesifo1_wp11736.pdf
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    More about this item

    Keywords

    private provision of public goods; GoBs; heterogeneity; externalities; free-riding; free-driving;
    All these keywords.

    JEL classification:

    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q59 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Other

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