Advantages And Disadvantages Of Public Goods

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By definition, public goods are those goods that have essentially two characteristic: non-rivalry and non-excludability. Very common example of public goods is national defense, parks, radio, services and street lights. It is the role of the government to provide these pure public good to the citizens because private enterprises that are profit-oriented will not be able to exclude people who do not pay for the product. However, pure public goods are very rare to find. Other types of public goods include congestible and quasi- public goods. The main problem associated with public goods is the problem of free ridership where people over consume services or products given to them for free. In relation to the subject of public goods, two literature …show more content…

This is inadequate when trying to sum up the state of supply of public goods in all the developed countries. Furthermore, this study only talks about the pure public good and there is not mention of how different types of public goods –quasi public goods and congested public goods – develop. The supply of various public goods differs with respect to their purpose. Another limitation of the study would be that it doesn’t factor in different economic problems that developed countries might be facing that directly affects the supply of public goods. For example, a country going through recession will have limited finances to supply the public goods due to reduced revenue. At the same time it is during recession that the demand for public goods rises. Also, government’s capital expenditure falls. In a situation like this, the quality of public goods like education and health service may decline, which this study has failed to mention. In situation like national spending cutoffs and increasing national debt, supply of public goods suffers severely while taxation rises. Another major issue that the study fails to incorporate is the level of taxation in these developed countries. Taxation varies from country to country, consequently public and welfare goods vary. The final fatal flaw of this research paper would be that a comparative analysis has not been made with the state of public goods in developing and under developed countries when specifying the different levels of development of process of public goods

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