Explain intuitively why the market for a nonexcludable good fails to provide an efficient quantity.
What will be an ideal response?
It takes resources to produce a good, irrespective of its excludability in consumption. If a good is not excludable, then producers of the good face the free-rider problem. If people have extremely strong incentives to free ride, nonexcludable goods will not be provided by private sectors.
Economics
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In the economic way of thinking, we assume that central bankers act
A) selfishly. B) to promote projects which interest them. C) in the national interest. D) in the global interest.
Economics
Which of the following are equilibrium conditions in the simple Keynesian model?
a. Ir = I b. G = T c. S + T = I + G d. Y = C + I + G e. A, c, and d
Economics