Unit 2.9 · Market Failure: Public Goods
Government Provision of Public Goods
AO3
Syllabus Requirement
Governments may directly provide public goods or contract private firms to do so, addressing market failure.
Assessment Objectives
AO3Synthesis and Evaluation
Summary
This topic discusses the government's role in providing public goods, which are often underproduced in a free market due to the free-rider problem. Understanding how and why governments intervene to supply these goods is essential for analyzing market failures and their impact on social welfare.