In The Rational Optimist Matt Ridley asks:

Can you doubt that if NASA had not existed some rich man would by now have spent his fortune on a man-on-the-moon programme for the prestige alone?

In fact, we have some pretty good historical data on this issue. Bearing in mind that observatories are an early form of space exploration, Alex MacDonald, a NASA research economist, notes:

For the majority of its history, space exploration in America has been funded privately. The trend

of wealthy individuals, such as Paul Allen, Jeff Bezos, Robert Bigelow, and Elon Musk,

devoting some of their resources to the exploration of space is not an emerging one, it is the

long-run, dominant trend which is now re-emerging.

MacDonald gives the following list of major observatories and their costs (click to enlarge). Privately funded observatories are in bold.

Private spending on space exploration is even more impressive when we scale by personal wealth.

…rather than scaling the expenditure as a share of the total resources of the U.S. economy, the expenditure can be scaled as a share of the resources of the individuals who undertook the projects. James Lick was the richest man in California and the Lick Observatory expenditure represented 17.5% of his entire estate. The equivalent share of the wealth of the richest man in California today, Larry Ellison, is $3.9 billion dollars, approximately four times higher than the GDP equivalent share.

Private space exploration and commercialization are likely to increase substantially in this century and, perhaps surprisingly, President Obama is pushing NASA in this direction. Here, for example, is a headline you don't see very often, "Obama defends privatization of space travel."

What is really going on is contracting-out rather than privatization per se and as such there is significant room for abuse. Nevertheless, if done carefully, I think Obama's efforts to encourage private efforts in space are a step in the right direction. What would be much more welcome and useful, however, would be a titling system for establishing property rights in space (see also here). Homesteading the highest frontier is our best bet for moving humanity off planet.