ManusJustus on 29 August 2008
That private entity has to have the ability to force customers to pay. If a harbor operates a lighthouse or pays a private lighthouse by charging ships that land there it would work, but it will never be as efficient as a publicly funded lighthouse because there are ships that can still use the lighthouse and do not pay a fee. Maybe they dock eleswhere, just passing through, etc.
In economics its referred to as a free rider problem.
