14.3.4 Privately Provided Public Goods: These are cases where non-excludable public goods are
provided privately. Usually this because there is a single market,
large consumer whose direct benefit is so large that it pays him to
provide it for himself.
Although there are free riders benefiting from this action, but
in deciding how much to supply, he looks only at his own direct
benefits, not at the benefits that accrue to others.
14.3.5 Publicly Provided Private Goods:
Publicly provided goods for which there is a large marginal
cost associated with supplying additional individuals.
Figure 14.3: Distortions Associated with Supplying Goods Freely When government provides a private good publicly, it simply
allows individuals to consume as much as they want without charge
cost Quantity B e Q m Q Welfare loss from excessive Pr ice Panel Curve Demand Marg inal consumption Pr ice Panel A Demand Curve Marg inal cost Quantity e Q m
