Syllabus T. Y. B. A. Paper : IV advanced economic theory with effect from academic year 2010-11 in idol

 
14.3.3 Pure and Impure Public Goods 
A pure public good is public goods where the marginal costs 
of providing it to an additional person are strictly zero and where it 
is not possible to exclude people from consumption of good. 
National defence is one of the few examples of a pure public good. 
In case of an impure public good where the cost of an 
additional person using an interstate highway without crowded is 
very, very small, but not zero, and it is possible to exclude people 
from using the highway, though relatively expensive.
PRIVATE
PURE
GOOD
Marg inalCost
ofUse
EaseofExclusion
Congested
highway
Fire
Pr otection
PUBLIC GOOD
National
defence
Healthservices,
education
PURE

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Figure 14.2: Publicly Provided Goods 
Figure 14.2 shows the ease of exclusion on the x axis and 
the marginal cost of an additional individual‘s using the good on the 
y axis. The lower left-hand point signifies a pure public good. The 
upper right-hand point signifies a good where the cost of exclusion 
is low and the marginal cost of an additional individual using the 
good is high.
Many goods provided by the state have one but not both of 
the characteristics of pure public goods to some degree. For 
instance, fire protection is like a private good because exclusion is 
relatively easy, i.e., if the fire protection is provided by the private 
firm, individuals who reuse to contribute could not be helped in the 
event of fire. But fire protection is like a public good because the 
marginal cost of covering an additional person is low. Most of the 
time fire fighters are not engaged in fighting fires but are waiting for 
calls. Protecting an additional person has very little extra cost. Only 
in a rare case when two fires break out simultaneously there will be 
a significant cost of providing to an additional person. 
Sometimes the marginal cost of using a good to which 
access is easy will be high. For instance, when a highway becomes 
congested, the cost of using it rises drastically, not in terms of wear 
and tear but in terms of time lost by drivers using the road. It is 
costly to exclude persons by charging for road use. This can be 
done only by toll roads, but very often the tollbooths contribute to 
the congestion.