10 Harv. J. L. & Pub. Pol'y 475 (1987)
Contracts and Public Goods

handle is hein.journals/hjlpp10 and id is 487 raw text is: CONTRACTS AND PUBLIC GOODS
DAVID SCHMIDTZ*
I. INTRODUCTION
What gives a government the right to coerce (tax) its own
citizens in order to raise funds for such goods as national de-
fense? The usual answer is that providing national defense is
important and there seems to be no other way to raise the nec-
essary funds except by coercion. But why cannot funds for na-
tional defense be raised by voluntary means? Many economists
and political philosophers answer that national defense is a pub-
lic good.1 In this Article, I shall explain what makes some com-
modities public goods and why many people think the
production of public goods requires, and even justifies, the use
of force. I shall also explain why I find these reasons
unconvincing.
A public good is a good whose consumption is nonexcludable
and nonrivalrous. A nonexcludable good is one that, when avail-
able to one person, is available to all, including those who do
not help to produce it. A nonrivalrous good is one whose use by
one person does not interfere with its use by others.2 Many
governmental activities are attempts to provide public goods.
For example, consider national defense. A nation that defends
itself from invasion defends those citizens who do not lift a fin-
ger to help as well as those citizens who do. National defense is
therefore nonexcludable. Further, one citizen enjoying the pro-
tection of a national defense system does not reduce the
amount of protection available for other citizens. Thus national
* B.S., University of Calgary, 1982; B.A., University of Saskatchewan, 1983; M.A.
University of Arizona, 1985; M.A. University of Arizona, 1987. Research for this paper
was funded by the Leonard P. Cassidy Summer Research Fellowship in Law and Philos-
ophy. I gratefully acknowledge the support of Walter Grinder and Randy Barnett and
the Institute for Humane Studies. I thank Allen Buchanan, David Conn, Mark Isaac,
Keith Lehrer, Ann Levey, Robert Schopp, and, most of all, Jules Coleman and Holly
Smith for teaching me much of what I know about the subject. I am indebted to Keith
Burgess-Jackson, Tyler Cowen, Dan Klein, and Elizabeth Willott for detailed critical
comments.
1. For a seminal work developing this thesis, see M. OLSON, THE LOGIC OF COLLEC-
TIVE ACTION (1965). See also S. RHODES, THE ECONOMIST'S VIEW OF THE WORLD: Gov-
ERNMENT, MARKETS, AND PUBLIC POLICY 66 (1985).
2. A similar definition can be found in Head, Public Goods and Public Policy, 17 PUB.
FIN. 197 (1962). Professor Head's discussion of jointness is particularly apt. Id. at
203.

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