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Kevin Quinn wrote: 
 
"Why don't private resources devoted to creating excludability, when public 
provision is feasible, constitute pure deadweight costs?  It is not 
desirable that *that* sort of discovery process go on, and taking care that 
it doesn't shifts resources into worthwhile discovery processes?" 
 
Kevin, I will try to answer your question briefly. In my view, the new 
approach to public goods gives us a framework for comparing different means 
of dealing with particular cases. These are cases in which we have good 
reason to believe that, because of non-exclusion and jointness, 
entrepreneurs would not identify resources and/or guide them into channels 
of goods production even though the collective benefits are greater than 
the costs of doing so. There is an additional proviso, however. It is that 
a property system of some sort already exists. Otherwise, only one reason 
for the entrepreneurial failure would dominate -- that there is no property 
system. This, I believe, was the scene with which Larry Moss was concerned 
in a recent post in which he referred to Hobbes as a source for insight 
into the history of public goods. 
 
Turning to your question, I am not sure what you mean by using the term 
"private" to modify the term "resources." So let me disregard this 
modifier. What we have to do is to assume some kind of property system, 
presumably one that reflects reality but at the same time is analytically 
manageable. Then we try to compare the consequences of non-intervention 
with the consequences of various forms of intervention (we might call these 
"institutional arrangements"). In making the comparison, we must account 
for all of the costs and benefits that we can realistically assume would 
exist under the alternative institutional arrangements. From this point of 
view, the costs to entrepreneurship of producing exclusion mechanisms ought 
to be taken into account. So also should the costs associated with 
alternative arrangements, as well as the benefits. 
 
So I think that my answer to your question is yes, although I would not 
phrase the question in the way that you did. 
 
Cheers 
 
 
 
 
-- 
Pat Gunning, American University of Sharjah, United Arab Emirates; 
Web pages on Praxeological Economics, Democracy, Taiwan, 
Ludwig von Mises, Austrian Economics, and my University Classes; 
http://www.gunning.cafeprogressive.com/welcome.htm 
http://www.fortunecity.com/meltingpot/barclay/212/welcome.htm 
 
 
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