The classic definition of a “public good” is that it is both “non-excludable” and “non-rival.” Textbooks normally treat these traits as binary, delivering this 2 x 2 typology:
Yet in the real world, both excludability and rivalry lie on a continuum. Almost nothing is 0% excludable. If you spend enough effort, you can prevent non-payers from enjoying your product. At the same time, almost every good requires some effort to exclude non-payers. Hence, nothing is 100% excludable either.
Think ...
Published on September 27, 2021 06:00