Common Property Resources and Public Goods

This chapter provides a classification of different types of goods based on the properties of rivalness and excludability. Non-private goods include artificially scarce goods, common property resources, and public goods. The economic theory for each type of good is presented. In each of these cases, government interventions may be warranted for reasons of efficiency and fairness. The chapter concludes with a discussion of global climate change. You’ll see that most economists advocate for strong policies to address climate change, such as carbon taxes and cap-and-trade approaches. Rapidly declining costs for renewable energy demonstrate that an energy transition away from fossil fuels is already underway.