User Fees, Charges, and Sales: A Comprehensive Analysis by Constantine Hadjilambrinos, Slides of Management Fundamentals

Download User Fees, Charges, and Sales: A Comprehensive Analysis by Constantine Hadjilambrinos and more Slides Management Fundamentals in PDF only on Docsity! PA 546 Constantine Hadjilambrinos User Fees, User Charges and Sales Docsity.com PA 546 Constantine Hadjilambrinos • User fees—government sales of licenses to  engage in otherwise restricted or forbidden  activities.  • User charges—charges for voluntarily  purchased publicly provided services.  • Sales—revenues from sale of goods and  services provided by government (government  monopolies, government‐controlled toll goods,  etc).  Docsity.com User Fees and Licenses  • Fees must be paid by whomever wants to  engage in activity that requires a  permit/license.  • Fees do not purchase any government  services.  • Vehicle registration fees, drivers’ licenses— necessary for vehicle operation but do not  purchase any services.  • Business license fees—different than franchises  PA 546 Constantine Hadjilambrinos Docsity.com User Charges  Charges paid for delivery of a good or service to a  relatively small number of individuals or  businesses.  Conditions: Benefit separability (identify who gets  what)           Benefit chargeability (ability to “meter”)  Benefits should be “private” rather than “public”  (education?)  Particularly appropriate when substantial waste  would result from under‐pricing.  PA 546 Constantine Hadjilambrinos Docsity.com Advantages:  Charge offers test of demand for goods and  services—government can respond.  Charge offsets the cost of delivery of goods  and services.  Charge allocates the cost of delivery equitably.  Charge may correct cost‐price signals in private  market.  PA 546 Constantine Hadjilambrinos Docsity.com