Public Goods and Externalities

The video explains the concept of public goods, highlighting their importance in a free market economy. It discusses how public goods like bridges are funded through taxes and the challenges of excluding non-payers. The debate over what should be public goods is explored, using education as an example. The free-rider problem is introduced, illustrating the issues with voluntary contributions for public goods. Externalities, both positive and negative, are explained, showing their impact on society and the economy.

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