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Taxpayers, Suckers and Free Riders

In the traditional theory, resources for providing public goods will not be contributed voluntarily. The state's role is to exert mutually agreed coercion and organize Pareto-superior exchanges of public goods against taxes. `Government failures' spoil the attractions of this solution. In a more general theory, `excludability' is replaced by exclusion cost, and `joint supply' by access not subject to price or non-price allocation. The probability that one's benefit is contingent on one's contribution becomes a significant variable. Rational non- altruists will not generally have a dominant strategy of non-contribution. They may choose the `sucker' or the `free rider' strategy, depending on their assessment of the risk of having no or too few public goods.