Spatial Public Goods. 1: Theory

This is the first of a two-part series of papers dealing with public goods in a spatial context. Public goods here are treated as being intentional spatial externalities. In that context, the new feature to be dealt with is optimal public investment, the impact of which diffuses, somehow, over space. First, the landscape, the spatial structure of the public good, and the decision framework are described both for the individuals involved and for the planner. Then, the issue of decentralisation is discussed in the case where land rents go to absentee landowners. An explicit comparison between private goods, public goods, and externalities in a spatial context follows, and the first part ends with the problem of allocating land to public goods. The second part deals with some conceptual applications.