Optimal Supply And Supplier Of Public Goods

The classical definition of public goods is from Samuelson’s paper in the fifties of the last century. The theory of public goods has been the hot issue of the academic research from then on. This article aims to explore two issues related to public goods, the optimum provision and the main mode of supply. The following parts mainly discuss the following aspects in this paper. First, we will summarize the discussion of domestic and foreign scholars for public goods. We found that the public goods have been researched as early as a few hundred years ago. Scholars to explore this problem include not only economists, but also include politicians and sociologists. The beginning of the discussion of this idea remained mostly conceptual. The theory of public goods has a good development after the fifties of the last century. Second, public goods is mainly refers to the kind of non-competitive, non-exclusive, indivisible items. Public goods are classified according to this definition. Public goods are divided into pure public goods and quasi-public goods. Pure public goods are non-competitive and non-exclusive items. Quasi-public goods are non-competitive or non-exclusive. Have a preliminary understanding of the public goods, we introduced and proved Samuelson rule. This rule describes that the optimal supply of public goods must have a number of conditions, which are the marginal social revenue equals the marginal social cost. The Samuelson rule not indicates how to share the cost of the provision of public goods. We use the Lindahl equilibrium to solve the problems that each participant pays for public goods. Third, the above discussion is built on the basis that the decision-makers of government understand each consumer’s real evaluation of public goods. Every consumer has the incentive to hide their true evaluation of public goods to not pay or to pay less the cost of provision of public goods in real life. Many scholars have constructed various display preferences to solve this problem. An example of the transformation of the Fudenberg and Tirole’s "Game Theory" display a preference mechanism in this paper. This mechanism, Samuelson rule and Lindahl equilibrium are combined to solve the problem of optimal quantity supplied public goods and optimal payment. Finally, the previous statement assumes that public goods are supplied by the government. Because public goods are non-exclusive and non-competitive, public goods are provided in market failure. Therefore the government is considered as the main supply of public goods. Economists found that many public goods which should be provided by the government are provided by the private. This is mainly because that not all of the items are non-exclusive. When the entire supply of public goods are fail in market and government, the supply of public goods need to rely on the third department.Description of the above problems tries to provide some ideas to solve the two problems of public goods. Many defects have not been able to solve due to constraint of time and restriction of my level. I expect to strengthen my ability to make this article more perfect in the future.