Abstract: The article Comments on the nature of club equilibrium conditions derived from club member utility maximization. In a seminal paper, economist James Buchanan (1965) introduced the notion of an economic club as a consumer cooperative internalizing the gains from collective provision of a public good. Club equilibrium conditions derived from the maximization of the utility of a representative club member, subject to a budget constraint embodying an equal cost-sharing condition for collective goods. Y. K. Ng (1973), an economist, has claimed that Buchanan's equilibrium clubs are not Pareto-efficient, since they entail the maximization of average rather than total net benefit from club formation. Ng's problem is that of determining optimal club size when only one club may form for each collective and there is a given number of potential club participants. The utility of an arbitrary consumer is maximized subject to a transformation constraint and given utility levels for all other consumers. Various claims on optimal club size are clarified once one understands that Buchanan and Ng were concerned with two distinct club problems. Buchanan perceived his frame of reference as an extension of the theory of decentralized consumer choice, with the theory expanded to incorporate preferences for sharing arrangements. The analysis accordingly had a market setting. In equilibrium, markets cleared with respect to quantities of goods, and also in the sense that no individual was excluded from his desired club.

　　Subjects: ECONOMICS; COOPERATIVE societies; CONSUMER cooperatives; ECONOMISTS; SOCIETIES, etc.; BUCHANAN, James, 1791-1868