Private good and public good
A private good is a good, which is enjoyed exclusively by single
individuals. The act of consuming the good by one individual excludes others from consuming it. A public good is publicly owned. The basic characteristic of public goods is non appropriability. Thus once public goods are made available, they are equally available to all individuals.
individuals. The act of consuming the good by one individual excludes others from consuming it. A public good is publicly owned. The basic characteristic of public goods is non appropriability. Thus once public goods are made available, they are equally available to all individuals.
Consequently, the "consumption" of public goods by one individual does not reduce the amount available to others. In addition to non appropriability, public: goods have the following two related characteristics; a public good has the non rivalry and non excludability character of consumption.
A good tarmac road here is an example of a public good.
One person can increase satisfaction from the commodity without reducing that obtained by others.
With nonexcludability, there is no feasible way of excluding anyone from gaining the benefits of a public good. Thus the benefits accrue equally to all individuals. Examples are national defence, a public clock, a public road, street lighting. Public goods are not consumed but enjoyed and are provided by the government. This is because they are not profitable to the private sector.