Tuesday, August 10, 2010

[tishflvp] Payment for club/public goods

Many public goods in the entertainment sector are actually club goods for some of their lifetime: movies in theaters before DVD release, concerts before CD release, and even Nielsen-like measurements of television shows and songs on radio.  Stations are motivated to make a profit on advertising, so they play what the public wants to consume.

Because the market decides how the club good is allocated and how much is consumed, we can trust those numbers to do something with them: a government grant of a multiple or percentage of the club revenue once the good is made a public good.  That multiplier may be legislatively set.

Need to avoid vertical monopolies in TV and radio production and broadcasting.

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