Question

what detrimental consequences is due to non excludability? explain

Answer 1

Non excludable goods like public goods cannot be excluded for any individual and consumption by one individuals do not affect changes in supply to other individual.

However they cause negative Externalities for example air pollution which affects all users. Also it causes free rider problem because for example parking paid by one customer can be bargained by other customer who park his own car and does not pay and gets parking for free.

These non excludable goods also face restrictions and eventually fall under private good, however exceptions are copyright, patents, congestion pricing .

answered by: anonymous