Summary and Main Ideas
Summary
Goods are the commodities, services, and systems that satisfy people’s wants or needs. Private goods can be owned by a particular person or group, and are excluded from use by others, typically by means of a price. Free-market economists believe that the government has no role in regulating the exchange of private goods because the market will regulate itself. Public goods, on the other hand, are goods like air, water, wildlife, and forests that no one owns, so no one has responsibility for them. Most people agree the government has some role to play in regulating public goods.
We categorize policy based upon the degree to which costs and benefits are concentrated on the few or diffused across the many. Distributive policy collects from the many and benefits the few, whereas regulatory policy focuses costs on one group while benefitting larger society. Redistributive policy shares the wealth and income of some groups with others.
Practice Questions
- Of the types of goods introduced in this section, which do you feel is the most important to the public generally and why? Which public policies are most important and why?
Glossary
free-market economics: a school of thought that believes the forces of supply and demand, working without any government intervention, are the most effective way for markets to operate
libertarians: people who believe that government almost always operates less efficiently than the private sector and that its actions should be kept to a minimum
redistributive policy: a policy in which costs are born by a relatively small number of groups or individuals, but benefits are expected to be enjoyed by a different group in society
regulatory policy: a policy that regulates companies and organizations in a way that protects the public
This lesson is part of:
American Domestic Policy