Public and Private Goods
The rationale of this report is to examine the various categories of goods and to briefly discuss their descriptions. In economics, a public good and a private good are differentiated in terms of non-exclusion and non-rivalry. This implies, respectively, that utilization of the product by one person does not lessen the availability of the product for utilization by others; and that nobody can be successfully excluded from consuming the product in case of public good. The opposite holds true for private goods.
In the actual world, there may be no such concept as an utterly non-excludable and non-rivaled good; but most economists think that some products estimate the notion closely for the evaluation to be useful economically. 2. Categories of Goods There are four widely recognized categories of goods; public goods, private goods, quasi-public goods and open access goods. 2. 1 Public Goods Geuss (2003) argues that public goods possesses two distinct features; non-rivalrous and non-excludability.
Non-excludability means the cost of sustaining non-payers from enjoying the advantages derived from the product is prohibitive while non-rival means that the cost of another consumer utilizing the product is zero. For instance, breathing air neither considerably decreases the volume of air obtainable to others, nor
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This qualifies air to be a public good, but one that is trivial economically as it is a free product. 2. 2 Quasi-public goods The intermediate category comprises quasi-public goods which to some degree share some features of public goods. For quasi-public goods; The expenditure of offering the product increases less significantly to the number of consumers who derive benefits from it and those who don’t pay the cost of the good cannot be completely excluded (Geuss, 2008).
These conditions are comparative. Some goods will come close the public edge of the range while others will come closer to purely private edger of the range. Information products are not characteristically public products but are in actual fact quasi-public goods. Their level of publicness diverges broadly, though; changes in technology can also change the level of publicness.