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Angela Kallhoff, Why Democracy Needs Public Goods

Maxime Desmarais-Tremblay
p. 249-253
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Angela Kallhoff, Why Democracy Needs Public Goods, Lexington Books (Rowman & Littlefield Publishers), 2011, 163 pages, ISBN 978-0-7391-5100-6

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Crédits : Rowman & Littlefield Publishers

1Angela Kallhoff is professor of ethics at the University of Vienna. Drawing from recent political philosophy, she makes the case that “public goods are useful in supporting democracy” (1). The arguments in favor of her thesis, constructed from both Constitutional, and Deliberative Democracy strands of thought are clearly presented in eight relatively short chapters, totaling 146 pages.

2After introducing the reasons for framing the discussion in normative political philosophy, Kallhoff reviews the classical conceptualization of public goods in public economics (Chapter 2 and 3). She goes on to redefine the two criteria (non-rivalry and non-excludability) developed by Samuelson and Musgrave to categorize public goods, as a condition of basic availability and a condition of open access. In her own words, basic availability means that “up to a certain point that needs to be defined for each good separately, each person has access to the same amount and the same type of benefits”(20), and open access means that “each person who wishes to profit from a public good can do so”, entrance barriers have to be defined in an “impartial manner” (20). One of the original points of her treatment—yet also a weakness—is to cut across the dividing line between the market and the State, which was one of the foundational aspect of the discussion in public finance. Hence, she stresses that public goods (in her sense) are not state-owned goods, nor welfare goods, nor communal goods, nor club goods. Without conducting a systematic analysis of each case, she names seven different types of tangibles final regimes of goods which fall under her definition: Inner and outer security, infrastructures (lighthouses, telecommunications, streets, highways,…), education and science (public schools, universities, libraries, media), environmental goods (clean air, water, sun, renewable energy, fishing grounds, national parks), public spaces (streets and sidewalks, city parks), cultural goods (theaters and opera, broadcasting, literature collected in libraries, entertainment, public events, landscapes that figure as cultural heritage), institutions of care (public hospital, public health care, child care) (26). Notice that economists could label most of those as merit goods.

3The four main arguments in support of her thesis are each covered in a separate chapter (4-7). In the fourth chapter, she discusses Dewey and Habermas on the public sphere and argues that “public goods are particularly useful in providing material conditions for the generation and regeneration of the public” (41). Some types of goods—she calls connectivity goods—give rise to desirable patterns of interaction by creating mutual awareness and experienced equality (e.g. public space, public events), and spheres of reliability through an institutional background which helps people to make sense of the world and to act in it.

4In the fifth chapter, Kallhoff takes up the issue of social justice in egalitarian theories of justice. Following Martha C. Nussbaum, she argues in favor of the production of central public goods, which help individuals to develop “central functional capabilities” (74). Kallhoff’s principle of fairness states that goods should be provided if (i) they are essential for a good life, (ii) they respect the two aforementioned conditions of access and availability which ensure that they result from a democratic process, and (iii) their production does not create a heavy social burden (74). In spite of that, she shies away from the political conclusion that the state ought to provide or fund them.

5From republican thought (chapter sixth), Kallhoff borrows the idea that institutional background, in the form of public goods, is required for the preservation of political self-determination. So-called identification goods “provide focal points for debate on issues of common concern”. (94). Moreover, they promote self-determination. For example, a public park can act as a catalyst in a virtuous circle: “The public park becomes a nice place when citizens like it. In turn, this motivates citizens to contribute to taking care of that place. … [Public goods] can serve as identification goods when citizens consider them ‘their’ goods.” (97). The author claims that such goods have a political function, but do not presuppose any common shared values, they are not “moral goods” (99). I think this claim is not convincing. One should recognize that promoting public life is a value commitment to a representation of what constitutes a good life for human beings.

6In chapter seven, the author engages in a conversation with John Rawls on the conditions of a reasonable pluralism. She defends the case that groups, like religious institutions, can legitimately provide public goods if they commit to open access. As she puts it: “Care for the poor and needy members of society has always been and still is part of the religious endeavor to enhance the common good.” (110). In Rawls’ political liberalism, actors can engage in the public bringing in their own values, as long as they respect the priority of political values (e.g. equality of men and women). One can even go further and note that “public goods function as focal points in which the contradictory forces of plural societies play out and crystallize.” (110). Hence, interaction and competition between different providers of public goods can promote tolerance. In the last chapter, Kallhoff addresses the libertarian (empirical and normative) arguments against government intervention.

7In the rest of this review, I would like to comment on three issues raised by Kallhoff’s approach to public goods. First, the historian of economic thought might be disappointed by her presentation of the classical public finance conceptualization of public goods. She starts from Buchanan’s confusing treatment of public goods as ‘joint supply’, and then moves on to Samuelson and Musgrave, claiming that “Paul A. Samuelson and Richard A. Musgrave shifted the scope of analysis toward the category of demand. Both tried to elaborate a single criterion to distinguish public goods from goods that are provided by markets.” (14). These two sentences contain many inaccuracies. First of all, it was Musgrave (1939) who introduced the continental corpus on public goods to Samuelson, and Buchanan’s interest in public goods mostly follows Musgrave’s and Samuelson’s, not the other way around. Second of all, Samuelson was not aiming at a single criterion. He gave a mathematical definition of collective consumption goods, which came later to be associated with one of the two criteria (non-rivalry) developed by Musgrave. It is true that, at first, Musgrave insisted mostly on non-exclusion, but as soon as 1959, he recognized that two conditions must combine for "social goods" to arise (Musgrave’s name for public goods).

8Thus, one has the impression that a better knowledge of the 20th century public finance debates on public goods would have improved the discussion in chapters 2 and 3. For recent historiographic work on the contributions of Samuelson, Buchanan and Musgrave to public goods theory, one can read Pickhardt (2006), Marciano (2013), Sturn (2010) and Desmarais-Tremblay (2013).

9Second, Kallhoff’s redefinition of the two-criteria could be problematic. Presumably, the two criteria have to be logically independent. For Samuelson (1954), collective consumption goods are such that the very same good is consumed by all (in the same quantity). Musgrave’s subtle reformulation of this idea into non-rivalry avoided the redundancy with his other criterion of non-exclusion. Sticking with Samuelson’s definition would not have done it, for if a good is in fact consumed by all, then logically no one is excluded from it. In other words, equal consumption entails impossibility of exclusion. But stating that non-rival goods can be such that consumption by one agent does not prevent consumption by another agent, does not entail the impossibility of exclusion. The category containing non-rival, yet excludable goods is not empty (so-called club goods). As for Kallhoff’s definition, there is a sense in which the ‘basic availability’ condition entails the ‘open access’ condition. Strictly speaking, if “each person has access to the same amount and the same type of benefits” (20), then necessarily there cannot be any discriminatory access barriers. For, if there would be any such barriers, then, there would be at least one individual who would not have access to the same benefits.

10Third, by refusing to draw a (normative) line between voluntary action and state (coercive) provision, Kallhoff leaves some economists’ concerns unattended. Modern public goods theory rose out of the idea that public expenditures and their funding must be linked in public finance. In Why Democracy Needs Public Goods, the philosopher provides normative arguments in favor of public goods, but repeatedly writes that it does not follow that they be owned by the state or even funded by it. One may find her conclusion overly optimistic: “the reasons why public goods serve democratic societies might suffice as a motivation for private businesses and private persons as well as for political institutions to invest in public goods.” (22). Besides, if goods are not funded by taxes, they generally need to be financed by a user fee (excluding the cases of advertising and voluntary donations for charity). Yet, fees can create availability barriers which need to be discussed. Market processes generally do not discriminate on gender or racial differences—that is open access is warranted—but basic availability depends on effective demand. Without welfare goods and redistribution, resource inequalities can create de facto exclusion. Hence, a discussion on the value of some goods like education, healthcare and transport could be enhanced by taking into account the effect of the provision mechanism on the conditions that are used to define them as public goods, namely basic availability and open access.

11Overall, the greatest merit of the book is to engage into a positive discussion on public goods, as opposed to the negative stance taken by economists in the market failure tradition. Where they focus on efficiency-restoring mechanisms, the philosopher takes fairness as the most important objective of public policy. Moreover, different perspectives emerge from the thicker conceptualization of individuals provided by philosophers like Kallhoff, as opposed to the narrower homo œconomicus or homo behavioralist of most economists. These observations illustrate the need for interdisciplinary dialogue on such complex questions as public goods.

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Bibliographie

Desmarais-Tremblay, Maxime. 2013. On the Definition of Public Goods. Assessing Richard A. Musgrave’s contribution. Paper presented at the 17th ESHET conference (16th May, Kingston, UK) and at the 14th Summer Institute for the History of Economic Thought (June 17th, Richmond, VA).

Marciano, Alain. 2013. Why Market Failures Are Not a Problem: James Buchanan on Market Imperfections, Voluntary Cooperation, and Externalities. History of Political Economy, 45(2): 223-254.

Musgrave, Richard A. 1939. The Voluntary Exchange Theory of Public Economy. The Quarterly Journal of Economics, 53(2): 213-237.

Musgrave, Richard A. 1959. The Theory of Public Finance. New York: McGraw-Hill.

Ostrom, Elinor. 2002. Property-Rights Regimes and Common Goods: A Complex Link. In A. Héritier (Ed.), Common Goods. Reinventing European And International Governance. Lanham, MD: Rowman & Littlefield Publishers: 29-57.

Pickhardt, Michael. 2006. Fifty Years After Samuelson’s “The Pure Theory of Public Expenditure”: What Are We Left With? Journal of the History of Economic Thought, 28(4): 439-460.

Samuelson, Paul A. 1954. The Pure Theory of Public Expenditure. The Review of Economics and Statistics, 36(4): 387-389.

Sturn, Richard. 2010. “Public Goods” Before Samuelson: Interwar Finanzwissenschaft and Musgrave’s synthesis. The European Journal of the History of Economic Thought, 17(2): 279-312.

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Maxime Desmarais-Tremblay, « Angela Kallhoff, Why Democracy Needs Public Goods  », Œconomia, 4-2 | 2014, 249-253.

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Maxime Desmarais-Tremblay, « Angela Kallhoff, Why Democracy Needs Public Goods  », Œconomia [En ligne], 4-2 | 2014, mis en ligne le 01 juin 2014, consulté le 25 septembre 2017. URL : http://oeconomia.revues.org/378

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Maxime Desmarais-Tremblay

Centre Walras-Pareto, Université de Lausanne, and Centre d’économie de la Sorbonne, Université Paris I Panthéon-Sorbonne. Maxime.desmarais-tremblay@unil.ch

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Les contenus d’Œconomia sont mis à disposition selon les termes de la Licence Creative Commons Attribution - Pas d'Utilisation Commerciale - Pas de Modification 4.0 International.

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