What is the difference between public goods and externalities?

Public goods are non-excludable and non-rival - i.e. you cannot be stopped from consuming the good and this does not affect others' consumption
Externalities are benefits/costs to a third party outside the market transaction
A public good such as knowledge could have positive externalities, but they are not the same thing

NS
Answered by Nicholas S. Economics tutor

2356 Views

See similar Economics A Level tutors

Related Economics A Level answers

All answers ▸

How does a reduction in the interest rate affect aggregate demand in a closed economy?


What is the Phillips Curve?


How does a firm's marginal cost and average cost relate to each other? (Microeconomics)


What is the relationship between income elasticity of demand and a normal and inferior good?


We're here to help

contact us iconContact ustelephone icon+44 (0) 203 773 6020
Facebook logoInstagram logoLinkedIn logo

MyTutor is part of the IXL family of brands:

© 2025 by IXL Learning