When Your House Is Burning Down, How Good Is a Public Good?
What is a public good? An article today describes a house fire in Tennessee, where the firefighters refused to extinguish the fire because the owners hadn’t paid the annual voluntary fee for fire protection. The firefighters only intervened when the fire spread to a neighbor’s field and threatened the (fee-paying) neighbor’s house. Is fire protection excludable? In a small town, with widely separated houses, it may be-after all, what is the harm to me if the house of the family who hadn’t paid its tax burns down? In such a case, the best argument for requiring payment of the fire-protection fee is that there are economies of scale in providing protection. But then the fee should be compulsory-a tax. In a suburb or city, the density of dwellings means that there are such large externalities that fire protection is non-excludable.