Make A List Of Goods That You Want. How The Study Of Economics Useful In Preparing It

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Public Good: Economic Definition and Examples

What is Public Good?
Examples of Public Good
Why is Public Good Important?
How is Public Good Funded?
Can Public Good be Privatized?

What is Public Good?

Public good is defined as a product or service that is non-excludable and non-rivalrous. Non-excludable means that it is impossible to prevent individuals from consuming the good or service, even if they do not pay for it. Non-rivalrous means that the consumption of the good or service by one individual does not reduce the availability of the good or service for others.

These characteristics make public goods different from private goods, which are both excludable and rivalrous. For example, a piece of candy is a private good because it can be easily excluded from someone who doesn't pay for it, and once someone eats it, it cannot be consumed by anyone else.

Examples of Public Good

One of the most common examples of public good is national defense. The military provides protection to all citizens regardless of whether they pay taxes or not. Another example is street lighting. The light from street lamps is available to everyone, and the consumption of the light by one person does not reduce the availability of the light for others.

Other examples of public goods include clean air and water, public parks, and the legal system. These goods are considered public goods because they are available to everyone and their consumption does not reduce their availability for others.

Why is Public Good Important?

Public goods are important for a number of reasons. Firstly, they provide essential services that are necessary for the functioning of society. National defense, for example, is crucial for protecting citizens from external threats. Secondly, public goods are often under-produced by the private sector, as there is little incentive for businesses to produce goods that are non-excludable and non-rivalrous. This means that the government must step in and provide these goods in order to ensure that they are available to all members of society. Finally, public goods help to promote social welfare by ensuring that everyone has access to essential services regardless of their ability to pay for them.

How is Public Good Funded?

Public goods are funded through taxation. The government collects taxes from individuals and businesses and uses the revenue to provide public goods and services. In some cases, the government may also charge user fees for certain public goods, such as national parks or toll roads.

There are different ways in which public goods can be funded. Some public goods are funded through general taxation, which means that everyone pays for them regardless of whether they use them or not. Other public goods are funded through targeted taxes or fees, which means that only those who use the goods or services pay for them.

Can Public Good be Privatized?

While public goods are typically provided by the government, there are some cases where they can be provided by the private sector. For example, national defense can be provided by private military contractors. However, the provision of public goods by the private sector can be problematic, as there is little incentive for businesses to provide goods that are non-excludable and non-rivalrous. This means that the government must often step in and provide these goods itself.

In conclusion, public goods are essential for the functioning of society. They provide essential services that are necessary for the well-being of all citizens, and they help to promote social welfare by ensuring that everyone has access to essential services regardless of their ability to pay for them. While public goods are typically provided by the government, there are some cases where they can be provided by the private sector. However, the provision of public goods by the private sector can be problematic, as there is little incentive for businesses to provide goods that are non-excludable and non-rivalrous.

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