Essays 9 and 10 addressed the question: How should goods, and consequently welfare, be allocated when some productive assets are privately owned (labor) and some are publicly owned (technology)? Essay 13 begins by arguing that the economic theory of public ownership is poorly developed in contrast to the theory of private ownership, which, as summarized in general equilibrium theory, is perhaps the crowning achievement of the last two centuries of economic thought. Ideally, one would like to have a positive theory of public ownership, that is, a theory describing how resources will actually be allocated in an economy where some assets are publicly owned. But it would also be valuable to have a normative theory of public ownership, one which describes what sets of allocations in an economy seem consistent with the rights summarized in the specified pattern of ownership, when some assets are publicly owned and others are privately owned. The normative approach was taken in the essays in Part III mentioned above.

In Essay 13, which reports my joint work with Joaquim Silvestre, an economic environment consisting of a finite number of agents is postulated, where there is one technology (fishing on a lake) that produces one output (fish) from inputs of labor. Fishers have preferences over fish consumed and labor expended. It is postulated that the fishers privately own their labor, but the lake is publicly owned. What resource allocation mechanism respects these property rights?