Public Good
Public good is a term used in economics to describe a commodity or service that is made available to all members of a society. It is non-excludable, meaning that it is impossible to prevent people from using it, and non-rivalrous, meaning that one person’s use of the good does not reduce the amount available for others. Examples of public goods include clean air, national defense, and street lighting.
History of the Term
The concept of public goods was first introduced by economist Paul Samuelson in 1954. He argued that certain goods and services, such as national defense, could not be provided efficiently by the private sector. This is because it is difficult to exclude people from using the good, and one person’s use of the good does not reduce the amount available for others. Samuelson argued that these goods should be provided by the government, as it is the only entity that can ensure that everyone has access to them.
Comparisons
| Good | Excludable | Rivalrous |
|---|---|---|
| Public Good | No | No |
| Private Good | Yes | Yes |
Summary
Public goods are commodities or services that are available to all members of a society. They are non-excludable, meaning that it is impossible to prevent people from using them, and non-rivalrous, meaning that one person’s use of the good does not reduce the amount available for others. The concept of public goods was first introduced by economist Paul Samuelson in 1954, and it is argued that these goods should be provided by the government. For more information on public goods, visit websites such as Investopedia, The Balance, and the World Bank.
See Also
- Private Good
- Common Good
- Excludability
- Rivalrousness
- Free Rider Problem
- Tragedy of the Commons
- Public Choice Theory
- Externalities
- Public Expenditure
- Public Finance
