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The Concept of Non-Excludability
A good or service is considered non-excludable when it is impossible or prohibitively costly to prevent individuals from benefiting from it, regardless of whether they have paid for it. This characteristic is a defining feature of pure public goods.
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Economics
Economy
Introduction to Microeconomics Course
CORE Econ
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A city government provides a large fireworks display for its citizens. The display is launched from a central location, making it visible to anyone within a several-mile radius. One person watching the display does not prevent others from also watching it, and it is practically impossible to stop people in the area from seeing it. Why does this fireworks display fit the economic definition of a public good?
A government policy gives every citizen a 15% raise in their monthly income. Simultaneously, due to increased demand and other factors, the average price of all goods and services rises by 15%. This policy will lead to a substantial improvement in the population's overall standard of living.
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A good is considered ____ when it is impossible or prohibitively costly to prevent individuals from benefiting from it, regardless of whether they have paid.
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A public university education is considered a public good because it is funded by the government and benefits society as a whole.
A large, unregulated fish population in the open ocean is accessible to anyone with a boat. The more fish one person catches, the fewer fish are available for others. Based on these characteristics, why is this fish population NOT considered a pure public good?
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Learn After
A coastal town maintains a lighthouse to guide ships and prevent them from running aground on nearby rocks. The light from the lighthouse is visible to all ships in the area, regardless of whether they are registered with the local port authority or have paid any fees. Which economic principle is best illustrated by the fact that it is not feasible to stop any specific ship from benefiting from the lighthouse's light?
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A privately-owned park that charges an admission fee and has a fence with a gate to control entry is an example of a non-excludable good because anyone in the community has the option to pay the fee and enter.
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When it is not feasible to prevent someone from enjoying the benefits of a good or service even if they do not pay for it, the good is said to be ____.
A private company develops a system that successfully eliminates all smog from a city's downtown area. To cover its costs, the company attempts to bill every resident and business in the area a 'clean air fee'. The business model fails because many people refuse to pay. What is the core economic principle that explains this failure?
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