Public goods are characterized by free-rider problems because
A)public goods are usually things that people really do not want to consume.
B)public goods are characterized by the principle of rival consumption.
C)no one can be excluded from the benefits of public goods once they have been produced.
D)public goods can easily be subdivided into small units.

Question

Quizplus · Accepted Answer

Public goods are non-excludable, meaning that individuals cannot be excluded from consuming the benefits of the good once it is produced. This creates a free-rider problem, where individuals may choose not to contribute to the production of the public good, but still benefit from it. This creates a collective action problem, where it is difficult to get individuals to contribute their fair share towards producing the public good.

Public Goods Are Characterized by Free-Rider Problems Because