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- Public goods are goods and services provided by the government for the benefit of all citizens.
| Public good | How it helps |
|---|---|
| Roads, bridges, parks, streetlights | Used by everyone |
| National defence | Protects the country from outside threats |
| Sanitation and drainage | Improve living conditions |
- Public goods are usually not provided by private companies because they do not generate direct profit .
- So they often need the government to provide or fund them.
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Example: the neighbourhood park
- A park costs money to build, and every family would benefit.
- If each family gives Rs 5,000, the park can be built.
- But many families think: "Others will pay. I can use it for free."
- So not enough money is collected, and the park is never built.
- Such goods need the government to provide or fund them, to ensure social welfare, economic development and equal access for all.
From your surroundings, list two goods or services that are provided by the government (for example: roads, streetlights, parks, police, and so on). Choose one of the goods you listed and answer: Who does benefit from it? Why would it be difficult for a private company to provide this service on its own? Imagine the government stops providing this good or service, what problems might people in your area face?
Two goods provided by the government: roads and streetlights. Chosen good: streetlights.
| Question | Answer |
|---|---|
| Who benefits? | Everyone on the street at night: walkers, drivers, shopkeepers, residents |
| Why is it hard for a private company? | Streetlights do not earn a direct profit, so a private company has little reason to provide them |
| What if the government stops? | Dark streets, more accidents and thefts, people feel unsafe at night |
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Goods and services provided by the government for the benefit of all citizens.
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Public goods are provided by the government for all citizens. Private goods are sold by private sellers to those who buy them.
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Profit.
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Public goods: roads, streetlights. Private goods: a mobile phone, a pizza.
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False. Many families expected others to pay, so not enough money was collected and the park was never built.
- Public goods like roads, parks and defence are provided by the government for everyone.
- They do not generate direct profit, so they are usually not provided by private companies.
- So they often require government provision or funding, as the neighbourhood park example shows.
