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Why public goods must be provided by the government? -

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Question

Why public goods must be provided by the government?

Options

  • The benefits of public goods can be easily enjoyed by anyone without affecting the consumption of other individuals.

  • No individual can be excluded from using public goods as it is available to all.

  • Both The benefits of public goods can be easily enjoyed by anyone without affecting the consumption of other individuals and no individual can be excluded from using public goods as it is available to all.

  • None of the above

MCQ

Solution

Both The benefits of public goods can be easily enjoyed by anyone without affecting the consumption of other individuals and no individual can be excluded from using public goods as it is available to all.

Explanation:

The term "public good" refers to a non-rival and non-excludable good. Non-rival means that one person's consumption has no bearing on the consumption of another. Non-excludable, on the other hand, means that no one can be prevented from using the good. For instance, parks, highways, national defense, and so forth.

The government is required to offer these products for the following reasons:

  1. The advantages of public commodities can be easily enjoyed by anyone without harming other people's consumption. There is a market failure that occurs.
  2. Because public commodities are open to everyone, no one can be denied access to them. The relationship between the producer and the consumer breaks down, prompting government intervention in the form of public policies. 
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