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Explain how a public good is different to a private good.

A public good has two characteristics that separate it from being a private good; non-rivalry and non-excludability. Non-rivalry means that your consumption of that good does not reduce the amount that another person can consume of that same good, and non-excludability means that you cannot exclude someone from being affected by the good. An example would be the defence industry e.g. military, navy etc. Every citizen of a country 'uses' this good, but this does not decrease its availability for an individual. Likewise, you cannot choose who this will or will not benefit; it is for everyone!

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Explain how a public good is different to a private good.

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