Difference between Public and Private Goods

Goods are something which we all use in our daily lives and the moment we wake up till we sleep we are using one or another product. However goods can public or private, to understand them better let’s look at the difference between the two –

  1. Public goods are those which are free to use and therefore there is no cost involved in usage of such products whereas for private product one has to pay in order to use them.
  2. Examples of public goods are air, roads, street lights and so on whereas examples of private goods are cars, cloths, furniture and so on.
  3. While usage of public products does not reduce its availability for other people so it is not like if one person is breathing fresh air the other individuals won’t get fresh air. This is not the case with private products because its usage leads to reduction in quantity or quality for others, so if one person has bought particular cloth it is not necessary that others will also be able to get same color, quality and texture of that cloth.
  4. Public goods are same for everybody so individual who is rich will also breathe same air which a poor person is breathing whereas in case of private products if one is rich one can buy better quality so if there are two televisions one is 3d which is expensive and other is normal which is cheap than a person who is rich will go for 3d television while person who is not that rich will buy normal television.
  5. Public goods are either provided by nature or government whereas private goods are provided or manufactured by entrepreneurs who make them in order to earn profit.

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