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David Hargreaves What is a Public Good and why might government intervention be necessary to ensure that the supply of a Public Good is socially optimal? To understand what a Public Good is it is necessary to look at its counterpart, a private good. Private goods are those that are traded in a market where buyers and sellers meet through the price mechanism. Thus private goods tend to be excludable in that they have clearly defined ownership and they tend to be 'rival', for example, if I eat an apple then somebody else cannot consume it. Public goods on the other are defined by two characteristics. They are 'non excludable' and 'non rival' and because they are non-excludable, they cannot be supplied through the normal market mechanisms, in which the provision of the goods depends on whether one is willing to pay for it. It is not possible therefore, except at a huge...

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