What is the difference between a merit good and a public good?

A merit good is a good which has positive externalites and therefore people do not consume enough of them. For example, vaccinations.

A public good has two characterisitics, it is non-rival: this means that for any given consumption level, more people using it does not diminish anyone else's consumption and non-excludable: we can't stop people using it. An example is defence. Non-excludabliltiy means there is a free rider problem and the good will be underprovided in the market.

Answered by Ella D. Economics tutor

6073 Views

See similar Economics A Level tutors

Related Economics A Level answers

All answers ▸

Why does a rise in interest rates lead to a fall in inflation?


Evaluation points for macroeconomics (Unit 2)


Evaluate the view that a reduction in UK unemployment is best achieved through the use of supply-side policies.


Choose an example of a negative externality and explain one policy which may help to solve it.


We're here to help

contact us iconContact usWhatsapp logoMessage us on Whatsapptelephone icon+44 (0) 203 773 6020
Facebook logoInstagram logoLinkedIn logo
Cookie Preferences