Also discussed here: Are Roads Public Goods, Club Goods, Private Goods, or Common Pools? (53 page pdf, Bruce Benson, Florida State University)
Today’s review article looks at the concept of a public good as applied to roads (and by extension to road tolls) and to transit, showing that is how the good is used or overused that something becomes public or private.
Key Quotes:
“Public goods have two distinct aspects: nonexcludability and nonrivalrous consumption. “Nonexcludability” means that the cost of keeping nonpayers from enjoying the benefits of the good or service is prohibitive. And nonrivalrous consumption means that one consumer’s use does not inhibit the consumption by others. A clear example being that when I look at a star, it doesn’t prevent others from seeing the same star”
“If a road is not congested, then one person’s use does not effect anyone else. In this case, use is not rival in consumption, and the road is a public good. Yet if a road is congested, then use of that road yields a negative externality. When one person drives on the road, it becomes more crowded, and other people must drive more slowly. In this case, the road is a common resource”
“a congested (or tolled to prevent congestion) road is a private good, and in the case that a roadway is oversupplied, it is simply a “low-congestion good”, often called a “club good.”
“the fact roads are either private goods or grossly oversupplied help weaken anyone’s case that transportation is government’s business in the first place”
Related articles
- harm the development - Wenzhou, China (travelpod.com)
- Paying for Roads and Pricing Transportation (pollutionfree.wordpress.com)
- Business leaders call for private toll roads (telegraph.co.uk)
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