This Example, However, Illustrates That "Non-Rivalness" Is Not the Only Characteristic Which Separates Public Goods from Private Goods. in These Cases, It Is Simple and Easy to Exclude People from the Game or Performance - We Can Stop People Who Have Not Paid from Getting into the Ground or Theatre, and Exclude Them. for a Public Good, However, This Is Not Possible - Public Goods Are Non-Excludable as Well as Being Non-Rival. Examples Include Street Lighting, Lighthouses, National Defence, Public Health (Cleaner Air, Disease Control Etc. ,) Radio and Tv Broadcasts [Though Note Here That It Is Possible, and Now Increasingly Inexpensive, to Exclude People - or at Least Fine Them If They Do Not Have the Appropriate Receiver License), And, Importantly, the Natural (Or Urban) Environment. There Are Also Such Things as Public Bads - Pollution Is the Classic Example, Which We Will Deal with Below.

Merit Goods (Also Publicly Provided)

The Issue Here Is That the Market Mechanism Is Capricious in the Income (And Wealth) Distribution That It Generates Between People. the Accidents of Birth, Personalities, Family Circumstances and Local Conditions All Combine with the Operation of the Market System Itself to Ensure That Incomes Are Never Equal. Although Most Governments Seek to Rectify This Somewhat with Social Security and Progressive Taxation Systems (Where the Rich Are Supposed to Pay More Than the Poor), the Fact Remains That Some People Will Be Richer Than Others, and Thus Have a Generally Greater Willingness to Pay. Social Justice and Equity Demand, However, That Some Things Are Too Important to Be Left to the Market (Even Given That the Poor Are Supported Through Income Supplements of Various Sorts). for Those Interested, a Thought-Piece by Your Lecturer on the Nhs Might Provoke Some Intelligent Comment?

A Typical Example Is Pollution of Air, Water or Soil, Were the Pollution Is the Unintended by-Product of Production Which Affects the Value of the Resource to Other Users or Enjoyers, but Which Is Not Accounted for in the Markets for Either the Production Inputs and Factors, or the Markets for the Products of the Production Process. Other Relevant Examples Are Pretty Countrysides and Wildlife, Which Are Largely a Consequence of Farming Practices in the Uk, Either Producing These "By-Products" or Not, Depending on the Practices Adopted.

3. Concluding Remarks on the Market System.

As Concerns over Food Security Diminished, and People Became Richer and More Leisured, So the Demands for Countryside and Wildlife Increased (Witness the Growth in Membership and Subscription to the Environmental and Wildlife Pressure Groups and Action Organisations Like the Rspb). So, Too, Does Public Support for the Policies of Agricultural Protection and Subsidy Diminish, Leading to Changes in the Government (Public) Policies with These Objectives, as Well as to Changes in Market Signals and Thus Responses of Both the Supply and the Demand Sides of the Market. the Growing Demand for Organic and Environmentally Freindly Food Production Is Having an Effect in the Market, Encouraging More of These Production Practices, as Well as Generating Pressure for Government Legislation and Policies.

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By Sarah Jenkins

• Oct 8, 2026 • 44 min read

Direct Answer • Key Takeaway

Of Course, This Gives Rise to Another Major Reason for Government Intervention and Regulation of the Market System: to Alter and Affect the Distribution of Income and Wealth Which the Market Generates, and the Distribution of the Economic Activity Which Goes with It over the Territorial Space of the Community - Geographical Distribution - So That the Less Well off Have a Greater Weight (More Income and/or More Say) in Determining What Is Produced (And Where). Remember the Judge Function of Governement at the Beginning of This Course (Explained in the Reference Chapter for Session 1)? the Government as 'Judge' Determines Fair and Just Distributions of Income, Wealth, Purchasing Power, Command over Goods and Services Etc. However, Economics Has Nothing to Say About the Exercise of This Function, Other Than to Point out That Any Practical Re-Distribution Typically Reduces the Efficiency of the Market System by Distorting the Economic Signals Encouraging People to Economise on Scarce Resources and Adopt the Most Productive and Efficient Systems.

Sarah Jenkins

Senior Technology Editor & AI Specialist

Sarah Jenkins is a veteran tech journalist with over 12 years of experience covering artificial intelligence, mobile innovations, and digital ethics. Her insights have appeared in leading technology publications worldwide.

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