Club good

Club goods (artificially-scarce goods) are a type of good in economics, sometimes classified as a subtype of public goods that are excludable but non-rivalrous, at least until reaching a point where congestion occurs. These goods are often provided by a natural monopoly.

Examples of club goods include private golf courses, cinemas, cable television, access to copyrighted works, and the services provided by social or religious clubs to their members. The EU is also treated as a club good.^[1]

Analyzing Ultra-Orthodox Jews in Israel, economist Eli Berman writes:^[2]

“

Religious prohibitions can be understood as an extreme tax on secular activity outside the club which substitutes for charitable activity within the club. A religious community lacking tax authority or unable to sufficiently subsidize charitable activity may choose prohibitions to increase this activity among members. Sabbath observance and dietary restrictions, for instance, can be rationalized with that approach. In this context the increased stringency of religious practice is an efficient communal response to rising real wages and to increased external subsidies.

”

	Excludable	Non-excludable
Rivalrous	Private goods food, clothing, cars, personal electronics	Common goods (Common-pool resources) fish stocks, timber, coal
Non-rivalrous	Club goods cinemas, private parks, satellite television	Public goods free-to-air television, air, national defense

References

1. ^ Ahrens, Joachim, Hoen, Herman W. And Ohr, Renate (2005): "Deepening Integration in an Enlarged EU: A Club-Theoretical Perspective", in: European Integration, Vol. 27, No. 4, pp. 417 - 439.
2. ^ Berman, Eli (August, 2000) “Sect, Subsidy and Sacrifice: An Economist’s View of Ultra-Orthodox Jews,” Quarterly Journal of Economics, 115(3).

• James M. Buchanan 1965. "An Economic Theory of Clubs." Economica, 32, pp. 1-14. Reprinted in Robert E. Kuenne, ed. (2000). Readings in Social Welfare, pp. 73-85.
• Suzanne Scotchmer, The New Palgrave: A Dictionary of Economics] 2008. "clubs," The New Palgrave Dictionary of Economics, 2nd Edition. Abstract.

External links

• EconPort Classification Table for Types of Goods