Economics - Merit Goods and Public Goods (1 Viewer)

[x.Exhaust.x]

What is the difference between Merit and Public Goods? Please give examples also. The simplest definition will do . Thanks.

Edit: Also, what's an externality? List examples as well .

 

[bettina44]

a merit good is a G that is undervalued by consumers whose production govt may subsidise.eg.public edu is a merit good as govt believes that the benefits of access to edu will be facilated through subsidation which improves equality of opp.


whereas a public good are goods that are non exclcudable and non rival ie.no one can be excluded form their consumption and one person consumption does not reduce the amount availabe for another person.eg.a public beach,roads

externality is an effect associated with the production or consumption of g or s which ---> a benefit or cost on the other producer or consumer.eg pollution would be a ext cost and a neighbour having pretty garden benefits you as it makes your street look good.

don't know if this helps or not

 

[ttong]

Merit goods- they're just goods that aren't produced in sufficient quantity by the private sectoras us individuals dont place enough value on them. eg. museums, public parks
Public goods- they're goods that the private sector dont supply at all as they cant say who is able or not able to use them regardless if they pay or not so the government provides them (something alng them lines). e.g. defence force, police service
Externalites are the social costs and benefits resulting from our economic activities (ie. production). there are positive and negative externalities. +ve-social benefits and -ve social costs

someone correct me if any of them are inaccurate

 

[x.Exhaust.x]

Ahk thanks bettina and ttong.