RATING THE VALUES OF GOVERNMENT AND MARKET SUPPLIED GOODS

Three studies are described in which respondents rated the total value of a range of goods and services, some supplied by the government, so me by the market. Study 1 found that a similar relationship between th e total rated value of a good to a country as a whole and per capita c ost was found for government and market items. However, while the tota l value and value of increasing spending by a small amount (marginal v alue) of government services were highly correlated, the total and mar ginal values of market goods were significantly less well correlated. Moreover, while the government and market goods had similar total valu es, the marginal values of the former were higher. Study 2 found that average differences between the ratings of the government and privatel y supplied goods correlated with preferences for distributing scarce g oods by regulation or the market system. Study 3 showed little correla tion of the average differences with scores on an economic belief scal e. The overall results suggest that people value government goods in a simpler way than they value market goods and that this difference mak es it difficult to compare the two types of goods with each other. (C) 1998 Elsevier Science B.V. All rights reserved.