Public Goods, Merit Goods, Demerit Goods, Private Goods & Free Goods

Public Goods – goods with characteristics of non-rivalry and non-excludability, e.g. national defence. See: Public goods

Merit Goods. Goods which people may underestimate benefits of. Also often has positive externalities, e.g. education. See: Merit goods

Demerit Goods. Goods where people may underestimate costs of consuming it. Often has negative externalities, e.g. smoking, drugs. See: Demerit goods

Private goods – goods which do have rivalry and excludability. The opposite of a public good See: Private goods

Free Goods – A good with no opportunity cost, e.g. breathing air. See: Free good