Public Goods Essay Example | Topics and Well Written Essays - 1000 words

Public Goods - Essay Example Public good in general takes the form that it can be consumed by every individual in a functioning society. Economics further defines the good to be non-rivalrous and non-excludable but impure public goods are characterized by partiality of the non-rivalrous and non-excludable properties as opposed to pure public goods that marry the fullness of the entire two properties. An externality associated with impure public goods arises when the general utility of a certain good or production probability of an agent is linked on the non-monetary or non-pecuniary actions of another agent. It is a cost or benefit not catered for by the prices of related goods and the parties involved in the production or consumption of the good. This translates into positive externality and negative externality that captures the benefit aspect and negative aspect respectively (Arriagada & Perring 806). Thus the types of externalities associated with impure public goods are positive externalities and negative externalities. Positive externalities has beneficial value in terms of the merit good meaning the overall effect of the public good results to a chain of positive outcomes especially in a market and the economy at large. A good example is that of inventions when made available to the public other will benefit by borrowing a leaf from the knowledge spillover of the invention information although law protects inventors in such a case by issuing of patent to enable the inventor earns royalties from the shared information. Another example would be an organization tasked with the mandate to prevent and control a highly infectious disease would have played a big role in society to prevent the greater part of the population from getting sick as a result of the infectious strain. Positive externality seems to be employing a control factor to management of public goods that are social in nature and affects the society or