Public Goods and Public Bads

Comments on Mancur Olson's "The Optimal Institutional Mix"

by Daniel Ellsberg

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By reducing the question of the optimal institutional mix to technical problems of efficiency — matters for administration or organizational theory — and by assuming the nature of the "public good" to be produced by government as "given," Mancur Olson abstracts the question from politics. Yet the nature of the good produced cannot be ignored and is an intensely political question. In fact, the production of many public goods also produces "public bads," for example the psychological and social impact of police harassment of ghetto residents in the course of "maintaining order." Olson fails to consider methods of reducing the production of specific public bads, a major consideration in conflicts over the optimal institutional mix.

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