ECS3704 Assignment 1
(COMPLETE
ANSWERS) Semester 1
2025 - DUE 17 March
2025;
For assistance contact
Email:
, Analysis of Public vs. Private Goods
Feature Public Goods Private Goods
Non-excludable: It is difficult or Excludable: It is possible to
impossible to prevent individuals from prevent individuals from
Excludability
consuming the good, even if they haven't consuming the good if they haven't
paid for it. paid for it.
Non-rivalrous: One person's Rivalrous: One person's
Rivalry in consumption of the good does not consumption of the good reduces
Consumption diminish the amount available for others the amount available for others to
to consume. consume.
Often provided by the government or
Typically provided by private firms
Provision through collective action due to the free-
for profit.
rider problem.
National defense, clean air, public parks Food, clothing, cars, private
Examples
(to some extent), street lighting. education, haircuts.
Export to Sheets
Mixed Goods (Quasi-Public Goods)
Certain goods, like higher education, are regarded as mixed goods or quasi-public goods
because they exhibit characteristics of both public and private goods, but don't perfectly fit into
either category.
Here's why higher education is considered a mixed good:
Partial Excludability: While public universities often have relatively low tuition fees,
they are not entirely free. Individuals who do not meet the admission requirements or do
not pay the required fees can be excluded from accessing these services. Private higher
education institutions are clearly excludable, as access is contingent upon payment of
often substantial fees and meeting admission criteria. This contrasts with a pure public
good like national defense, where no one can be excluded from its protection.
Partial Rivalry in Consumption: While a lecture hall might accommodate a large
number of students without significantly diminishing the learning experience for others
(initially appearing non-rivalrous), there are limits. Overcrowding can reduce the quality
of education due to factors like limited interaction with instructors, strain on resources
(libraries, labs), and a less conducive learning environment. Furthermore, the prestige and
selectivity of certain higher education institutions imply a degree of rivalry – admission
to a highly sought-after program means another student is excluded. This contrasts with a
pure public good like clean air, where one person breathing it doesn't reduce the amount
available for others.
(COMPLETE
ANSWERS) Semester 1
2025 - DUE 17 March
2025;
For assistance contact
Email:
, Analysis of Public vs. Private Goods
Feature Public Goods Private Goods
Non-excludable: It is difficult or Excludable: It is possible to
impossible to prevent individuals from prevent individuals from
Excludability
consuming the good, even if they haven't consuming the good if they haven't
paid for it. paid for it.
Non-rivalrous: One person's Rivalrous: One person's
Rivalry in consumption of the good does not consumption of the good reduces
Consumption diminish the amount available for others the amount available for others to
to consume. consume.
Often provided by the government or
Typically provided by private firms
Provision through collective action due to the free-
for profit.
rider problem.
National defense, clean air, public parks Food, clothing, cars, private
Examples
(to some extent), street lighting. education, haircuts.
Export to Sheets
Mixed Goods (Quasi-Public Goods)
Certain goods, like higher education, are regarded as mixed goods or quasi-public goods
because they exhibit characteristics of both public and private goods, but don't perfectly fit into
either category.
Here's why higher education is considered a mixed good:
Partial Excludability: While public universities often have relatively low tuition fees,
they are not entirely free. Individuals who do not meet the admission requirements or do
not pay the required fees can be excluded from accessing these services. Private higher
education institutions are clearly excludable, as access is contingent upon payment of
often substantial fees and meeting admission criteria. This contrasts with a pure public
good like national defense, where no one can be excluded from its protection.
Partial Rivalry in Consumption: While a lecture hall might accommodate a large
number of students without significantly diminishing the learning experience for others
(initially appearing non-rivalrous), there are limits. Overcrowding can reduce the quality
of education due to factors like limited interaction with instructors, strain on resources
(libraries, labs), and a less conducive learning environment. Furthermore, the prestige and
selectivity of certain higher education institutions imply a degree of rivalry – admission
to a highly sought-after program means another student is excluded. This contrasts with a
pure public good like clean air, where one person breathing it doesn't reduce the amount
available for others.
