Question

Why must public goods be provided by the government instead of the free market

Answer 1

Public goods are goods which features the unique properties of being non-rivalry and non-excitability at the same time. Non-rivalry refers to the fact that these goods are not depleted by their ‘consumption’. In other words, when a user makes use of the good, it does not deprive another user of using it. Non-excitability refers to the fact that it is impossible or too costly to exclude non-paying users from using the goods. Streetlights exemplify these two properties of public goods; once it is provided, any additional users using it doesn’t diminish its value to existing users and at the same time, it’s hard to exclude non-paying people from using it tourist who don’t contribute to the taxes that might be spent on building the street lights can use them all thesame. As a result, the goods suffer from free-ridership

Answer 2

Answer:

The correct answer is a combination of different factors.

Explanation:

First of all, public goods have the characteristic of being both non-excludable and non-rivalrous, so that means that every citizen has the right to use a public good, or in other words that person can not be excluded from the use of the good and that the use from another citizen does not prevents simultaneous consumption by other consumers.

Second of all, the government must provide these kind of goods because it is their duty to make sure that the people and only them are the most importance thing to take care about, so that means that there is no personal or private interest involved in the creation and divulgation of public goods. Moreover, it is important to understand that the government does not seek for profits but it does for the common good of the majority, instead of the private companies that are more interest in making greater amounts of money.