POLD89H3 Lecture Notes - Westminster System, Party System, Spritsail
8 Dec 2011
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Document Summary
Collective goods (public goods) possess two characteristics: jointness of supply. If a good is supplied to any member of a group, then it is supplied to all members of that group. In contrast to private goods, collective goods are therefore indivisible. If new members are added to the group, other members who are currently benefiting from (or consuming ) the good will not receive a diminished amount. As in any prisoner"s dilemma, both sides have an incentive to defect (erect trade barriers), because, no matter what the other side does, defecting will yield a better outcome for the defector. Unfortunately, the equilibrium outcome is mutual protectionism: non-exclusiveness, a jointly supplied good may be either excludable or non-excludable. Some jointly supplied goods can be withheld from members of the group, but a collective good is jointly supplied and non-excludable. Democracy, a term made of 2 greek words: demos (people) and kratia (rule: forms of democracy, direct.
