AREC 202 Lecture Notes - Lecture 26: Private Good, Club Good
7 Dec 2016
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Tuesday, december 6, 2016 chapter 17: public goods and common resources. Private goods-and others: difference between installing a new bathroom and building a municipal sewage system, difference between having chicken and shing in the open ocean, basic difference in the characteristics of the goods, bathroom appliances, chicken. Why markers can supply only private goods ef ciently: problem for non-taxable goods: Free-rider problem: individuals have no incentive to pay for their own consumption and instead can take a free ride on anyone who does pay: problem for non-rival goods: The ef cient price for consumption is zero > inef ciently low consumption when a price larger than zero is charged. Public goods: a public good is the exact opposite of a private good: It is a good that is both non-excludable and non-rival in consumption: here are some other example of public goods:
