excludability
Quick Summary
In economics, a public good is defined by two key characteristics: it is non-excludable and non-rivalrous.1
- Non-excludable: It's impossible to prevent individuals from benefiting from the good, even if they don't pay for it.
- Non-rivalrous: One person's use or enjoyment of the good does not reduce the amount available for others.
Clean air and national defense are common examples of public goods. In contrast, private goods are both excludable (producers can prevent non-payers from consuming them) and rivalrous (one person's consumption prevents another's). Examples include food and clothing. Markets often undersupply public goods because individuals have little incentive to pay for something they can get for free, leading to market failures that may require government intervention.12
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