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Resolving Conflicts Arising from the Privatization of Environmental Data (2001) / Chapter Skim
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Pages 42-45

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From page 42...
... The Rationale for Public Funding for the Trunk and Roots As noted above, the economic rationale for public funding of the trunk and roots of the information tree derives from the public good nature of environmental information, and the characteristic of declining average costs. The public good aspect can be summarized as follows.
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From page 43...
... To facilitate further distribution these facts should be made available at no more than the marginal cost of reproduction and should be useable without restriction for all purposes. The aspect of declining average cost leads to the following observations: Homogeneous product markets lead to monopolies.
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From page 44...
... For the shared environmental systems under discussion measurements must be made using a variety of remotely sensed and in situ instruments, positioned both throughout the United States and in other countries, and combined with retrospective data. The infrastructure, communications, and personnel costs of participating facilities are high compared with the cost of disseminating the resulting data and information products.' · The cost of making and distributing additional copies of each core product is negligible compared to the cost of generating the master copy.
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From page 45...
... Such competition can be expected to Tower the street price until there is no possibility of the primary producer recovering even a significant fraction of the total cost of production. Under these circumstances, a Tower limit to the street price is set by the marginal cost of reproduction (i.e., by the additional cost to an intermediary of making a single extra copy)
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Key Terms

  • average costs
  • declining average
  • core products
  • environmental information
  • social return

  • marginal cost
  • public purposes
  • private return
  • greatly reduced
  • street price

  • marginal costs
  • core information
  • primary producer
  • information products
  • public funding

  • core product
  • retrospective data
  • disseminating data
  • highly undesirable
  • pure public

  • scientifically valid
  • particular clients
  • secondary price
  • tower limit
  • average investment

  • participating facilities
  • competitive markets
  • recover expenses
  • personnel costs
  • distributing additional


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