Calabresi on Merit Goods

Abstract

Guido Calabresi has been one of the first scholars to use the concept of merit goods coined by Richard A. Musgrave in The Theory of Public Finance (1959). Although the concept had a mixed reception in economics, Calabresi detected its fruitfulness for a more realistic theorisation of the allocation of goods. Starting from a study of the tragic choices a society needs to make concerning the value of life, Calabresi provides an original conceptualisation of merit goods which is partly complementary to the classical definitions given by Musgrave. However, Calabresi’s conceptualisation is limited by its cost/benefit welfarist approach. Moreover, it leaves out important strands of justification for merit goods. After some preliminary remarks on Calabresi’s encounter with Musgrave, the paper analyses Calabresi’s two arguments for merit goods exposed in The Future of Law & Economics (2016). It then suggests that a theory of merit goods would gain from moving away from the emotivist conceptualisation according to which people feel bad about certain goods being traded for money to a conceptualisation of the reasons for allocating specific goods to specific institutions.

Merit Goods

“…The last 10 years saw important new contributions, linking the discussion on merit goods not only to behavioral economics and nudges but also to historical and heterodox schools of economic, political and social thought. One of the founding fathers of the Law and Economics movement, Guido Calabresi has recently suggested integrating merit goods into legal-economic analysis (Calabresi 2016, see also Desmarais-Tremblay 2019b).…”