Public goods Flashcards
1
Q
What is the free rider problem ?
A
People who don’t pay for a public good still receive benefits from it so the private sector will under provide the good as they can’t make a profit
2
Q
How does non rivality link to public goods ?
A
One persons use doesn’t prevent another persons use
3
Q
How is a public good non excludable ?
A
Someone can’t be prevented from using the good
4
Q
How is a public good non reject-able?
A
People can’t choose not to consume a good
5
Q
What is a public good ?
A
non excludable non rivalry non rejectable and have zero marginal cost
6
Q
What is a private good ?
A
Goods that are rival and excludable
7
Q
What is state provision ?
A
When the government provides public goods or merit goods which are under provided
