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These may seem trite to you, but I find them more than illustrative.

First Example

In one of the classrooms I teach in, there is an analog clock up in the corner of the room. Both I and the students find it useful in managing our time and attention in class. I remark, very obnoxiously at times, to the class that every year when daylight savings time comes in November, the clock is off by an hour and will remain that way until the next Spring. For years I have urged students, almost entirely jokingly, to complain about it and demand to the college that our clock accurately reflect the time at all times. For 8 years this has never happened.

I walked into class today and noticed, beyond expectation, that the clock had in fact been fixed. Now, students probably don’t want to complain to the “authorities” that a simple clock is not timed correctly (or maybe I am wrong about that), and it certainly makes no rational sense (in an egoistic framework) for any student to change the clock. Why? It is a pain in the butt to change the clock, and the gains largely accrue, unremunerated, to everyone else in the class.

One of my students climbed up either before class today or after last class and changed the clock. He privately provided a public good.

 

Second Example

Most of the office hours I hold are by appointment for 10 minute slots. But once per week I hold open walk-in hours with no sign-ups and no specified time lengths. Despite me doing this, almost no student who ever visits office hours on those open days happens to stay beyond 10 minutes or so. This is especially startling since the gains to staying would seem to clearly outweigh the costsĀ to themĀ of leaving. Yet for some reason our students tend to internalize this positive externality and provide the service of leaving on time, thereby ensuring that their classmates have ample time to come ask questions.

 

For discussion: are these exceptions that prove the rule, or are these generalizable behaviors? If they are generalizable, then what kind of a theory explains why these sorts of private productions of public goods are common but the perception is that “bigger and more important” goods will not be provided?

One Response to “Private Production of Public Goods – Two Simple Examples”

  1. ken sato says:

    Hi Michael,
    I have one question, which some what related to the article.
    What do you think the idea of running government with voluntary donations but no taxation?
    I think as long as people allow governments to tax people, including printing fiat money, we never seen even “smaller” government.

Leave a Reply to ken sato