It is inefficient to charge a positive price for a collective consumption good.

Question

Quizplus · Accepted Answer

A collective consumption good provides benefits to a group of people, and its consumption by one individual does not reduce its availability for others. Therefore, charging a positive price for such a good may exclude some individuals from its benefits, leading to an inefficient outcome. In such cases, it may be better to finance the production of the collective consumption good through taxes or other forms of public financing.

It Is Inefficient to Charge a Positive Price for a Collective