Question

Public-opinion polls in a small city have revealed that citizens want more resources spent on public safety, an annual fireworks display, and more community swimming pools. Which of these three citizen requests could be privatized by assigning property rights?

Short answer

The fireworks display and community swimming pools could be privatized.

Step-by-step solution

Identify Privatization Potential

Determine whether each request can logically be assigned private ownership. Public safety typically involves essential services like policing and firefighting, which are typically considered public goods due to non-excludability and non-rivalry. Fireworks displays, while sometimes public events, could be offered by private entities selling tickets, making them excludable. Swimming pools can be privatized since entry can be controlled through membership or entrance fees.

Analyze Public Safety

Public safety services such as policing and firefighting are inherently public responsibilities because they are essential services that are better provided by the government to ensure safety and order. Privatizing these services poses ethical and practical challenges, such as potential inequality in service availability.

Evaluate Fireworks Display

A fireworks display can be privatized by allowing a private company to host the event. The company can charge for tickets to view the display, making it a private good by being excludable. This aligns with the characteristics of privatizable goods, as individuals not paying are excluded from consuming the good.

Assess Community Swimming Pools

Swimming pools can be privatized by allowing a private entity to operate and maintain the facility, charging admission fees or memberships. This makes the swimming pool excludable and rivalrous, fitting the definition of a private good, since facilities can limit access through controlled entry and membership.

Key concepts

Public Safety

Public safety covers essential services such as policing, firefighting, and emergency medical responses. It plays a crucial role in keeping communities safe and maintaining order. These services are generally seen as public goods because of two core characteristics: non-excludability and non-rivalry.

Non-excludability means that once these services are provided, it is difficult to prevent anyone from benefiting from them, whether they contributed to the cost or not. For example, everyone in the community benefits from reduced crime rates due to effective policing, without having to pay directly for it. This also includes fire protection services that safeguard entire neighborhoods; a fire being put out prevents it from spreading to nearby properties.

Non-rivalry indicates that the use of the service by one individual does not reduce its availability to others. Everyone in the community can simultaneously enjoy the benefits of public safety without it being worn out or diminished for others. If these were privatized, it could lead to unequal access to protective services, leaving some individuals underserved, which is why these are typically managed as public goods by the government.

Fireworks Display

Fireworks displays are grand events enjoyed by many, often taking place during holidays or local celebrations. Although fireworks displays can be considered public events when city-sponsored, they have potential for privatization. If a private company organizes a fireworks show, it can charge attendees, making it excludable.

Turning a fireworks display into a private good means the organizer can issue tickets. Only those who pay for a ticket can enjoy the show, effectively controlling and managing who can view it. This characteristic of excludability differentiates them from pure public goods, where everyone in the vicinity can enjoy them for free.

By privatizing through this method, it turns the event into a private experience, allowing companies to cover costs and make a profit. It provides an opportunity to also enhance the experience by controlling the environment, such as providing reserved seating or exclusive vantage points, thus offering an improved service that justifies the entry fee.

Community Swimming Pools

Community swimming pools are facilities that can easily shift from public to private operation. They become privatized mainly because they display characteristics of excludability and rivalry.

Excludability in swimming pools is straightforward; only individuals who pay an entrance fee or hold a membership can access the facility. Gates, entry tickets, or membership cards are simple methods to enforce this excludability.

Rivalry exists in swimming pools because there is limited space and resources, such as lanes and seating. As more people use the pool, it can become crowded, reducing enjoyment and access for others. Therefore, privatization ensures that demand is managed by regulating the number of admissions, thereby maintaining the quality of the experience for paying users.

Private operators can also improve pool facilities, offer scheduled lessons or events, and maintain higher standards of cleanliness and safety. These factors contribute to making privatized pools a viable option in communities, turning them into excellent venues for recreation while ensuring proper upkeep and services.