1. Providing for People Public Goods

2. A shared good or service Impractical or inefficient to 1. make consumers pay individually 2. Exclude nonpayers- 48% no taxes Roads and dams good examples No reduction in benefit through use Why public goods? Benefit greater than cost both to individuals and society as whole

3. Public Goods Public Sector- part of economy that involves transactions of federal government Private Sector-part of economy that involves individuals and business only Free Rider-People who don’t want/pay for the public service but get benefits anyway. Fire Services/New Freeway examples Market Failures- situation where the market on its own fails to distribute resources well

4. Externalities-economic side effects that generates costs/benefits Dam and Lake-Positives Swimming Boating Fishing Lakefront views Dam and Lake-Negatives Loss of wildlife habitat Disruption of fish Overcrowding due to tourism Noise from racing boats/watercraft

5. Government and externalities Wants positive externalities Education-students/society benefit Limit negative externalities How do they limit? Regulations/laws Clean air act Emissions, plant standards etc,,