HAT Manifesto Part 1/3 - Rubric Cube - 241201 revision

 Mostly summarized from Gregory Mankiw’s Principles of Economics, 5th Ed.

PART 4 The Economics of the Public Sector
Chapter 11 of 36 Public Goods and Common Resources
Section 2 of 14
…
An old song goes "the best things in life are free."
There are many goods the songwriter could have been thinking of.
Nature gives us some, including rivers, mountains, beaches, lakes, and oceans.
Government provides others, such as playgrounds and parks.
Most goods in an economy are private not public and are allocated in markets.
In markets buyers pay for what they receive and sellers are paid for what they provide.
For private goods prices are the signals that guide decisions of buyers and sellers.
These decisions lead to an efficient allocation of resources.
…
When goods are public and free of charge market forces that allocate resources are absent.
Here we will examine the problems that arise for the allocation of resources when there are goods without market prices.
When a good does not have a price, there is not a market to ensure the good
· is produced and consumed in economically efficient amounts
· is consumed by those who value it the most
In public goods cases government policy can remedy or limit the market failure.
… …
public goods and private goods
kōkyō zai to shiteki zai
公共財と私的財