ABSTRACT
The professional literature on the economics of public goods goes back more than a century, but in its modern form starts with a classic article by Paul Samuelson (1954), whose theory of public goods formalized and mathematicized some ideas that had been around before. A pure public good in the economic literature is one that has two properties: non-rivalry, implying consumption by one party does not diminish the possibility of consumption by others, and non-exclusiveness, implying that no one in the relevant vicinity can be excluded from consuming the good. These are strong conditions and few pure public goods exist. The most relevant examples involve knowledge – once an idea or concept has been promulgated it is available to anyone who can understand it, at no additional cost. Other examples would be knowledge of dramatic events, such as a space walk or a visit to the moon and, locally, clean air that is available for all in the vicinity to breathe.
