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DeutschPreference revelation
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In public choice theory, preference revelation (also preference revelation problem) is an area of study concerned with ascertaining the public's demand for public goods.[1][2] According to some economists, if government planners do not have "full knowledge of individual preference functions",[3] then it is likely that public goods will be under- or over-supplied.[4][5][6][7] When there is no market to induce people to reveal their subjective valuations, economists say that there is a “problem of preference revelation.” When perfect compensation is possible in principle, it may be impossible in fact because of the problem of preference revelation
Overview
[edit]Unlike private goods, public goods are non-excludable and non-rivalrous.[8] This means that it is possible for people to benefit from a public good without having to help contribute to its production.[9] Given that information about marginal benefits is available only from the individuals themselves, people have an incentive to under report their valuation for public goods.[10][11]
See also
[edit]References
[edit]- ^ Public Choice: An Introduction
- ^ John, McMillan (1979). "The Free-Rider Problem: A Survey". Economic Record. 55 (2): 95–107. doi:10.1111/j.1475-4932.1979.tb02209.x.
- ^ Public Goods and Multi-Level Government
- ^ Kennett, Patricia (2008). Governance, globalization and public policy. Edward Elgar Publishing. p. 28. ISBN 978-1845424367
- ^ "Public Goods and Public Choices" (PDF). Archived from the original (PDF) on 2005-05-20. Retrieved 2005-05-20.
- ^ User Charges for Public Services: Potentials and Problems
- ^ Ethical Dimensions of the Economy
- ^ Providing Global Public Goods
- ^ The Encyclopedia of Public Choice, Volume 2
- ^ Multipart pricing of public goods Archived 2013-12-03 at the Wayback Machine
- ^ Throsby, C.D.; Withers, Glenn A. (1986). "Strategic bias and demand for public goods". Journal of Public Economics. 31 (3): 307–327. doi:10.1016/0047-2727(86)90063-0.