Interactive Examples
Public Goods and the Tragedy of the Commons
Begin
To navigate, please click the appropriate green buttons.
(Do not use the arrows on your keyboard)
Material from this presentation can be found in:
Chapter 13
Slides By
David Gillette and Kevin Brady
CoreEconomics, 2e
Interactive Examples
Public Goods and the Tragedy of the Commons
QUESTION ONE
Which of the following could be used to
illustrate the nature of a public good?
a) A can
of soda.
b) A lighthouse.
c) A bike trail in a city park.
Hint
Answer
Interactive Examples
Public Goods and the Tragedy of the Commons
QUESTION ONE
Which of the following could be used to
illustrate the nature of a public good?
a) A can
of soda.
b) A lighthouse.
HINT:
Think of the how the characteristics of nonrivalry
and nonexcludability are applied to each of these
goods.
c) A bike trail in a city park.
Interactive Examples
Public Goods and the Tragedy of the Commons
QUESTION ONE
Next
Which of the following could be used to
illustrate the nature of a public good?
a) A can of soda.
b) A lighthouse.
c) A bike trail in a city park.
ANSWER:
a) A can of soda is a private good; it is both rival and exclusive.
b) The services of a lighthouse are both nonrival and nonexclusive, making it a pure public good.
c) A bike trail in a city park is nonexclusive, but it is rival. Only so many bikers can use it at the
same time.
The only good from the three listed that can be used to illustrate the nature of a public good is the
lighthouse.
Interactive Examples
Public Goods and the Tragedy of the Commons
QUESTION TWO
Think about the last DVD movie
you purchased.
As which of the four types of
goods below should it be
classified?
a) A pure private good
b) A public good with exclusion
c) A common property resource
d) A pure public good
Hint
Answer
Interactive Examples
Public Goods and the Tragedy of the Commons
QUESTION TWO
Think about the last DVD movie
you purchased.
As which of the four types of
goods below should it be
classified?
a) A pure private good
b) A public good with exclusion
c) A common property resource
d) A pure public good
HINT:
How does a DVD movie fare
when the nonrival and
nonexcludable concepts
are applied to it?
Interactive Examples
Public Goods and the Tragedy of the Commons
QUESTION TWO
Think about the last DVD movie
you purchased.
As which of the four types of
goods below should it be
classified?
a) A pure private good
b) A public good with exclusion
c) A common property resource
d) A pure public good
ANSWER:
Next
Let’s consider both the nonexcludability and nonrivalry
attributes of a DVD movie.
The copy of a DVD movie that you purchase and bring
home is certainly exclusive. Only those people you
allow into your home, or to whom you lend it, will be
able to view the movie.
Now that we know the DVD movie is exclusive, is it
rival or nonrival in consumption? Does your viewing it
reduce or prohibit anyone else's ability to view the
movie? The ability for someone else to view the movie
with you is only limited by the size of your room and
capability of your entertainment system, not by the
DVD movie itself. It is also true that your viewing the
movie does not reduce the ability of subsequent
viewing by someone else.
Your ability to exclude others from viewing your copy of
the movie along with your ability to invite others to view
it with you makes your copy of a DVD movie a public
good with exclusion.
Interactive Examples
Public Goods and the Tragedy of the Commons
QUESTION THREE
Consider the flu vaccination
that thousands of people, but
not everyone, get each year as
the flu season begins.
As which of the four types of
goods below should it be
classified?
a) A pure private good
b) A public good with exclusion
c) A common property resource
d) A pure public good
Hint
Answer
Interactive Examples
Public Goods and the Tragedy of the Commons
QUESTION THREE
Consider the flu vaccination
that thousands of people, but
not everyone, get each year as
the flu season begins.
As which of the four types of
goods below should it be
classified?
a) A pure private good
b) A public good with exclusion
c) A common property resource
d) A pure public good
HINT:
How does the vaccine fare under
the nonexcludability and
nonrivalry concepts?
Interactive Examples
Public Goods and the Tragedy of the Commons
ANSWER:
Next
QUESTION THREE
Let’s consider each answer in turn.
Consider the flu vaccination
that thousands of people, but
not everyone, get each year as
the flu season begins.
a) The shot itself is both rival and
exclusive and can be considered a pure
private good.
As which of the four types of
goods below should it be
classified?
a) A pure private good
b) A public good with exclusion
c) A common property resource
d) A pure public good
b) Since it can only be injected into one
person, it is definitely not nonrival.
c) Since it is exclusive, either through
injection or through the method of
distribution and/or payment, it is not a
common property resource.
d) If a person who is injected does not
get the flu then that person will also not
expose and infect anyone else with the
flu. Not infecting someone else is both
nonexclusive and nonrival. Thus the
effects of a flu shot pass the public good
tests.
Interactive Examples
Public Goods and the Tragedy of the Commons
QUESTION FOUR
In recent years several cities have
experimented with various types of bike
sharing programs that make it possible for
people to use a “public” bicycle for a short
period of time (generally a few hours) and
then leave it for the next person to use.
Many of these programs have experienced
difficulty with “high rates of mechanical
problems and rapid evaporation of their
inventory.”
As which of the four types of goods below
should these bicycles be classified?
a) A pure private good
b) A public good with exclusion
c) A common property resource
d) A pure public good
Hint
Answer
Interactive Examples
Public Goods and the Tragedy of the Commons
QUESTION FOUR
In recent years several cities have
experimented with various types of bike
sharing programs that make it possible for
people to use a “public” bicycle for a short
period of time (generally a few hours) and
then leave it for the next person to use.
Many of these programs have experienced
difficulty with “high rates of mechanical
problems and rapid evaporation of their
inventory.”
As which of the four types of goods below
should these bicycles be classified?
HINT:
a) A pure private good
Apply the nonexcludability and
nonrivalry concepts to the use of a
bicycle in a bike-share program.
b) A public good with exclusion
c) A common property resource
d) A pure public good
Interactive Examples
Public Goods and the Tragedy of the Commons
QUESTION FOUR
In recent years several cities have
experimented with various types of bike
sharing programs that make it possible for
people to use a “public” bicycle for a short
period of time (generally a few hours) and
then leave it for the next person to use.
Many of these programs have experienced
difficulty with “high rates of mechanical
problems and rapid evaporation of their
inventory.”
As which of the four types of goods below
should these bicycles be classified?
a) A pure private good
b) A public good with exclusion
c) A common property resource
d) A pure public good
ANSWER:
a) A bicycle is exclusive when it’s locked up and
rival while it is in use.
b) A bike is also nonrival in the sense that once a
rider is finished using it another rider can still
subsequently use the bike.
c) Since no one has to own one of these shared
bikes in order to use them, and the intent is that
anyone can use them, they are essentially
nonexclusive. While in use, however, they are rival
thus qualifying as a common property resource.
d) If they are essentially nonexclusive and also
nonrival in terms of subsequent use, then they also
have pure public good characteristics. Thus to a
certain degree bicycles qualify as each type of
good. They have enough features of common
property resources to generate a Tragedy of the
Commons problem in terms of loss and disrepair,
but also enough features of pure private goods that
with careful planning bike share programs have
been able to see success.
The End