Here at Crammer Nation, we're big believers in explanation through example. That's why we'll be using entry into concerts at Study Street Bar & Grille as the exchangeable good on the market throughout this article!
Pure public goods explained
It's a Thursday night and you are looking to hit your favorite bar for a night of great dancing and loud music, but first you need to check the website to make sure they aren’t hosting any concerts that require a ticket for entry.
Study Street Bar & Grille has no capacity tonight! No tickets required for entry to see DJ CRAM.
Perfect! No capacity and no need to purchase a ticket! You are stoked to get the night started.
In this scenario, you are benefitting from a pure public good.
A pure public good is a good or service that can be consumed simultaneously by everyone and no one can be excluded.
Due to the fact that you do not have to purchase a ticket for entry, you cannot be excluded from a night out with your friends.
This embodies the first feature of a pure public good...
Non-excludable means that it's impossible or extremely costly to prevent someone from benefitting from a good who has not paid for it.
The other great bonus is that the bar has no capacity, meaning there is no rivalry amongst you or your friends for entry.
This embodies the second feature of a pure public good...