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Fireworks Cookies and Public Goods

Happy 4th of July!

Happy 4th of July!

There are all kinds of goods. Things you buy and only you eat. Things you buy and you share. Things you buy and consuming it doesn’t affect others. And things you don’t have to pay for but you and your friends get to enjoy.

Today we’re talking about fireworks. First off. Who doesn’t like fireworks? They are fun, pretty, and seem to get better every year. In economic verbiage, we get “utility” from watching them.

Have you ever paid money to watch fireworks? No, I’m not talking about paying to go to a theme park or a carnival and then watching a fireworks show there. I’m saying have you ever paid to just watch fireworks. Why not? Well… I guess the question really should be… why would you pay to watch fireworks? Let’s say there was a town that was putting on a fireworks show. They wanted to charge for everyone that goes to the park to watch the fireworks. Well, what would you do? You’d probably go just outside the park and watch the fireworks. They can’t prevent you from looking at the sky. In fact, you can imagine that everyone would hang out right outside the paying area just to watch the fireworks.

Fireworks are public goods. Things you don’t have to buy for you and your friends to enjoy. If my neighbor pays for a fireworks show outside her house, well I can enjoy it too. I can free-ride off of my neighbor.

As you hopefully can imagine using the example of fireworks, it is very hard to charge for public goods. So, who supplies them? The government. Or charities. I’ve lived in two little towns that dot the Hudson Valley, and I’ve lived in large cities such as NYC, Houston, and Nashville. I’ve seen pretty awesome fireworks shows in each of these places. Last year, I went down to the Hudson to watch the fireworks shooting off from Newburgh, the town across the river. As I walked home, I watched as big houses in the area shot off their own fireworks. Thanks! I don’t live in Newburgh and I certainly didn’t pay the families in town to do it – but I really appreciated it.

Here is the trick and the important part of public goods… not enough of them would be supplied in the market if the government didn’t step in. Like we agreed before, we get enjoyment from fireworks. How sad would it be if you couldn’t have them? But since it is hard to charge for them, we probably won’t have very many.

Ok. Fireworks might seem a little silly because we could probably all survive without fireworks. We wouldn’t be THAT much worse off. But you can think of other goods that fit into this same bill. National defense… the police… the fire department. Things that you benefit from but didn’t pay for individually. Your neighbor could pay for the police, and you would just free-ride off of her. If the market was left alone, less than the optimal amount would be produced.

For now, enjoy the fireworks! And be thankful the local government supplies such a beautiful public good for you!

Fireworks Cookies.

This cookie is from Smitten Kitchen. She calls them “Confetti Cookies.” She goes through a lot of work to explain how to make them in a mixer or a food processor. Go check them out (click on the link above)! You won’t be disappointed.

They are a great cookie to make with kids. The dough is easy to put together, and you really can’t mess up rolling cookie dough balls in sprinkles.

I wanted to make these look as much like fireworks, so I used a combination of different sprinkles from Michaels. I’ve also done them with traditional sprinkles and with just red, white, and blue sprinkles. They would also be great at Christmas with red and green, Hanukkah with blue and white, Easter with pastel colors. Ok. You’ve got the point. Grab some sprinkles. Bake some cookies. And think about public goods.


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