Private Goods vs Public Goods
Public goods cannot or do not exclude non-paying users and your consumption does not reduce others' consumption.
Glossary:
- private goods (demand for)The demand curve for private goods is a horizontal summation of individual demands because consumption of private goods is subject to rivalry.
- private goodsGoods that are subject to consumption rivalry but can easily exclude non-payers.
- public goodsGoods that are not subject to consumption rivalry but cannot easily exclude non-payers either by design or due to technical difficulty.
- public goods (demand for)The demand curve for public goods represents a vertical summation of individual demands because consumption of public goods is not subject to rivalry.
Topics:
Keywords
consumption rivalry, excludability, private goods, public goods