Ask Question
5 August, 23:24

Why won't a private business produce a nonexcludable public good?

+5
Answers (1)
  1. 6 August, 01:09
    0
    Public goods are goods which are non-excludable (no one can be denied from using it) and non-rival (use by one wouldn't affect the consumption by another).

    Because of this, people want to use the good but not pay for it as they know, once the good is provided, they can't be excluded from using it. This is called Free riding.

    Private companies will not be able to tackle the problem of free riding as they won't know what rate to charge and how to make everyone pay.

    Govt. can, however do this easily.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Why won't a private business produce a nonexcludable public good? ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers