![]() ![]() (Some exclusive parks provide keys to legitimate users, while others use gatekeepers to charge admission.) Also like highways, it is possible, but expensive, to exclude potential users, since exclusion requires fences and a means for admitting some but not others. Like highways, recreational parks are nonrivalrous at low-use levels, becoming rivalrous as they become sufficiently crowded. Thus, west Texas interstate highways are usually nonrivalrous, while Los Angeles’s freeways are usually very rivalrous. As congestion grows beyond this level, traffic slows down and congestion sets in. A two-lane highway generally flows at 60 mph or more provided there are fewer than 200 cars per lane per hour, while a four-lane highway can accommodate 700 cars per lane per hour at the same speed. The effect of doubling the number of lanes from two to four is dramatic. With fewer than 700 cars per lane per hour on a four-lane highway, generally the flow of traffic is unimpeded. That is, the marginal cost of an additional user is essentially zero for a sizeable number of users, but then marginal cost grows rapidly in the number of users. Highways are also rivalrous at high-congestion levels, but nonrivalrous at low-congestion levels. ![]() Highways are an intermediate case where exclusion is possible only at a significant cost, and thus should be avoided if possible. Exclusion is quite expensive, partly because the tollbooths require staffing, but mainly because of the delays imposed on drivers associated with paying the tolls-the time costs of toll roads are high. A toll highway shows that exclusion is possible on the highways. ![]() Another good that permits exclusion at a cost is a highway. Similarly, technological and software inventions are nonrivalrous, even though a patent grants the right to exclude the use by others. Both poems and theorems are nonrivalrous. It is theoretically possible to exclude some people from the use of a poem or a mathematical theorem, but exclusion is generally quite difficult. That is, the same expenditure of resources protects all. Similarly, the defense of the national borders exhibits a fair degree of nonrivalry, especially insofar as the strategy of defense is to deter an attack in the first place. Once we have kept our enemies out of our borders, we’ve protected everyone within the borders. National defense is clearly nonexcludable because, if we spend the resources necessary to defend our national borders, it isn’t going to be possible to defend everything except one apartment on the second floor of a three-story apartment building on East Maple Street. The classic example of a public good is national defense. is a good that has two attributes: Nonexcludability Condition in which the producer can’t prevent the use of the good by others., which means the producer can’t prevent the use of the good by others, and nonrivalry Condition in which many people can use a good simultaneously., which means that many people can use the good simultaneously. What are people who just use public goods without paying called, and what is their effect on economic performance?Ī public good A good that has the attributes of nonexclusivity and nonrivalry. ![]()
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