Which statement about pure public goods is NOT true?

Which statement about pure public goods is NOT true?

• A. The private market typically provides it efficiently.
• B. The good is non-excludable.
• C. The good is non-rival in consumption.
• D. It cannot be provided by voluntary contributions alone.

Answer: (A)

Pure public goods are defined by two features: non-excludable and non-rival in consumption. Because you can’t feasibly exclude nonpayers and one person’s use doesn’t reduce another’s, individuals have an incentive to free-ride rather than pay. This means private markets tend to underprovide such goods, since there’s no reliable way to charge for them and cover the costs. As a result, pure public goods are typically provided or funded by the government. So the statement that the private market typically provides it efficiently is not true. The other statements describe the real characteristics: the good is non-excludable and non-rival, and voluntary contributions alone generally cannot ensure adequate provision due to the free-rider problem.

Pure public goods are defined by two features: non-excludable and non-rival in consumption. Because you can’t feasibly exclude nonpayers and one person’s use doesn’t reduce another’s, individuals have an incentive to free-ride rather than pay. This means private markets tend to underprovide such goods, since there’s no reliable way to charge for them and cover the costs. As a result, pure public goods are typically provided or funded by the government. So the statement that the private market typically provides it efficiently is not true. The other statements describe the real characteristics: the good is non-excludable and non-rival, and voluntary contributions alone generally cannot ensure adequate provision due to the free-rider problem.