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Voluntarily contributing to a public good (such as Wikipedia) is a strong social norm. The tendency to follow such norms even if this is costly in the short run has developed over humans' evolutionary history, as in small to medium-sized hunter-gatherer communities this behavior was adaptive, e.g. due to reputation effects ("community enforcement")....


24

I wouldn't underestimate the role of learning by answering. Drafting a significant text typically forces a person to put their thoughts in order, to engage in research, and then to structure the information for the purpose of recording and conveying it. It is not unusual that further insights or questions emerge during this process, the answerer certainly ...


13

tl;dr: There could be multiple explanations depending on how you want to treat Wikipedia. If you want to treat Wikipedia as public good where everyone contributes a small part towards its creation and that everyone then enjoys equality you can explain it as people trying to still satisfy their own preferences through consuming the final Wikipedia page. You ...


10

Two relevant economic principles are: Economies of scale: These are a more significant issue for middle and especially high schools which have a greater need for specialist teachers, as others have pointed out, and also for specialist facilities such as science labs with supporting technicians. Such teachers and facilities would tend to be under-utilised in ...


8

Look at the data For starters, the obvious thing is to look at the data about the self-reported reasons for contributing to wikipedia (and I'm surprised that neither the question asker nor most of the answers have done so). For example, Wikipedia itself has a section on the motivation that refers to multiple studies - though many of them are behind a paywall ...


7

It depends actually a non-congested road can be considered non-rivalrous as when you drive there you don’t really reduce the enjoyment or marginal utility of other people driving them. However, once the road is congested it becomes rivalrous. Also note that even though many textbooks include public roads as public goods this is actually not technically ...


6

I guess it might depend on the author. Here's another classification: The classifications of public goods associated to agriculture identify two main categories: environmental goods and non-environmental goods (or social goods). In the first category are placed those public goods closely related to environmental externalities, such as farmland ...


5

In the Samuelson's definition of public good, the good must be non-excludable and non-rivalrous. Hyperlinks (if public and pointing to public pages) are non-excludable, and --to the condition of not overloading the hosted content-- non-rivalrous. The frequency of publication (and other criterions) of hyperlinks pointing to specific pages/domain, is used by ...


5

The objective is to show that, as long as $f'(n\hat\theta)\ne \alpha$, a firm can always engineer a package $(p',\hat\theta')=(p+\Delta p,\hat\theta+\Delta \hat{\theta})$ such that (i) a caring consumer strictly prefers this package, and (ii) the firm makes positive profits. 1) Your maths are correct: the inequalities are always false when f is increasing ...


5

One common definition of a non-rival good (see here and (A)) is a good for which the consumption of additional units involves zero marginal social costs of production. On this definition the service provided by a fire service would always be rival, because (even with plenty of capacity in terms of fire engines and staff) each visit to attend a fire involves ...


4

Interesting question..... I attended public schools at all three levels and they were less than a mile from where I lived --- the elementary school and the high school were less than half a mile away, and probably also the junior high school (as 7th through 9th grades were called). The most conspicuous difference between the way things were done in ...


3

The social welfare maximizing outcome you computed (by equating the sum of marginal benefits to marginal cost) is just one of the Pareto efficient outcomes. Although maximization of joint utilities is a sufficient condition for Pareto efficiency, it is not a necessary condition. Pareto efficiency is defined by the lack of Pareto improvement -- a reallocation ...


3

The most common one I have considered is health insurance as a private market. It becomes a case of the "market for lemons", where in this case the `lemons' are the people seeking insurance. https://personal.utdallas.edu/~nina.baranchuk/Fin7310/papers/Akerlof1970.pdf The simplified narrative goes something like this: Assumptions: Say insurance ...


3

In a competitive market for a private good (y) individuals may consume different quantities but the equilibrium condition requires that: $$ \frac{\frac{\delta u^{i}}{\delta y}}{\frac{\delta u^{i}}{\delta x}} = MRS^{i}_{yx} = MRT_{yx} \; \forall \; i $$ In the case of a public good (g) individuals may have different MRS but consume the same amount of the ...


3

The cross elasticity of demand $E_{XY}^D$ is defined as the percent change in quantity demanded for X divided by the percent change in price of Y, holding the price of X fixed. The problem with your calculation is that you did not use the quantity change when the price is fixed. Therefore, you need additional data to calculate the cross elasticities. ...


2

I don't think it is true in a standard public good economy the question is referring to. Consider the following counterexample: Suppose $I = \{1,2\}$ and utility of the individual $i$ depends on his consumption of public good $(G)$ and private good $x_i$: $u_1(G, x_1) = 2\sqrt{G} + x_1$ and $u_2(G, x_2) = 2\sqrt{G} + x_2$, Also, the CRS technology used ...


2

To obtain $\frac{\partial y}{\partial z_n}=0$, you implicitly assume that each consumer takes its own skill level as given. And in such a case, in reality the consumer optimizes with respect to labor supplied only. Perhaps it would be better to optimaze with respect to $l$ given $n$. Regarding aggregation the discrete analogous would not be what you write ...


2

Let $b_i\in\{0,B\}$ be $i$'s strategy. Then $i$'s payoff depends on the strategy profile $(b_i,b_{-i})$, where $b_{-i}=(b_j)_{j\ne i}$. \begin{equation} u_i(b_i,b_{-i})= \begin{cases} v_i&\text{if $b_i=0$ and $b_j=B$ for some $j\ne i$}\\ 0& \text{if $b_i=0$ and $b_j=0$ for all $j\ne i$}\\ v_i-B&\text{if $b_i=B$} \end{cases} \end{equation} Thus,...


2

Many obstacles to converting common goods into private goods are legal or normative rather than technological. For example, the technology necessary for congestion pricing of traffic is long established and indeed in use since the 1970's in Singapore. The existence of electronic transmitters or plate readers (London) may make for finer gradations of pricing ...


2

Am I correct to say that the app is non-excludable? I am sorry to say but this is wrong. Just assume google removes the application from the store. All android users would be excluded. There are many ways to exclude people from consuming an application. Access can be bound to a minimum age requirement, to a certain country (geo-blocking) or simply to a ...


2

I had a look, and there's not a alot, and not much that is current. The problem is, the question (What is the impact of NASA on the economy?) is too big and too difficult to measure. I think you'll have better luck by focusing on particular angles to this question. For example, when referring to the impact of NASA, this could be anything from impacts on the ...


2

For the Nash equilibrium of any simultaneous-play game, you are looking for the point where each player is playing a best response to all other players at the same time. So your steps to solving this game should be: Determine player 1's best response function ($g_1$ as a function of $g_2$) Determine player 2's best response function ($g_2$ as a function of ...


2

First let's clarify some terminology: I assume that with "common resources" you mean goods that are non-excludable but rivalrous. The term that applies in those cases is open access. In common resources there are shared property rights so some excludability (this is one of the mistakes in Hardin's tragedy of the commons). The answer to your two related ...


1

You can take MRS as the willingness to pay (Take the other good in MRS as money). If the good is a private good that costs 3, your willingness to pay should be 3 because you are buying it for yourself. However, a public good is used by all payers, so we only need the sum of the willingnesses to pay to be equal to 3. (You are simply splitting the bill)


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From Wikipedia: Social goods are defined as public goods that could be delivered as private goods, but are usually delivered by the government for various reasons, including social policy, and funded via public funds like taxes. https://en.wikipedia.org/wiki/Public_good#Social_goods The Wikipedia article also has a qualifier: defined by whom?


1

Given $$\max_{x_2^h} \quad U^h(\phi(\bar z + y^h - x_2^h), x_2^h)$$ You have to find FOCs by taking the chain rule twice for the first argument. Denote the argument for function $\phi$ as $(\cdot)$. $$\frac{\partial U^h}{\partial x_2^h} = \frac{\partial U^h}{\partial \phi} \cdot \frac{\partial \phi}{\partial x_2^h}$$ $$\frac{\partial \phi}{\partial x_2^h} ...


1

Government policy. This video explains the Federal Government's (FHA) rules for making loans to developers during the Great Depression gave preference to things called "neighborhood units." Neighborhood units had to center their design around an elementary school. So developers followed suit and designed their neighborhoods according to the FHA guidelines.


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The appropriate role of government is to improve on free activity of the market by improving how the market works (ie fixing market failures). For skill certifications to be an appropriate role for government, such certification would have to be a public good, which would require that it creates a positive externality - a value given to someone that hasn't ...


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