Public And Private Goods, Natural Resources and Monopolies
| Rival multiple consumers cannot consume the same good |
Non-Rival multiple consumers can consume the same good |
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| Excludable consumption can be detected and prevented by producer |
Private Goods Efficiently produced and allocated by markets
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Club Goods ("Natural Monopoly") High fixed costs, low marginal costs => inefficient competition
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| Non-Excludable consumption cannot be detected or prevented |
Common Goods ("Natural Resources") Tragedy of the commons, negative externalities => overconsumption
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Public Goods Free riders, positive externalities => underproduction
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Further Reading
- Do Markets Under-Produce Public Goods?
- Can Torts Police All Negative Externalities?
- Ch. 11 Public Goods and Common Resources in Principles of Economics by Greg Mankiw
- The Free Rider Problem in the Stanford Encyclopedia of Philosophy
- Public Goods and Externalities in the Concise Encyclopedia of Economics by Tyler Cowan
page revision: 15, last edited: 16 Feb 2016 20:18