Free Riders & Public Goods Flashcards
1
Q
Free Riders
A
Someone who receives the benefit of a good without paying for it.
2
Q
Public Goods
A
Non-congestible and non-excludable.
3
Q
Lindahl Pricing of public goods
A
Each individual pays a tax of their marginal benefit, but everyone has an incentive to lowball their marginal benefit.
4
Q
Clarke Tax
A
You keep track of everyone’s preference and whoever if the benefit exceeds the cost, you distribute the tax = to the benefit among those who say they will benefit.
5
Q
Weakest Link Public Goods
A
They can only be provided when everyone participates. E.g. vaccines.
