The enconimics goods are the products or services that are provided to satisfy the needs and wants of consumers. When you want to buy some, you go to a store or go to an online site to exchange money for them.
Therefore, anything for which resources are exchanged in the form of money or work can be classified as an economic good. That is, when a product or service can be sold at a price. This can be for a company, individual, government or other organization.
It is important to bear in mind that economic goods are also scarce, which is why they are called “economic”. As a result, they require human labor to be created and still demand a price when sold..
This differs from free goods, which, having a very large supply, cannot impose a price, such as the air and water of a river. The economic good is of interest to society, in addition to having a certain scarcity.
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An economic good has a certain degree of scarcity relative to demand. This scarcity creates value that people are willing to pay for, and creates opportunity cost.
For example, if pears are picked from a tree, it means that other people will not be able to enjoy them. If resources are dedicated to extracting oil, the opportunity cost is that this effort will not be able to be dedicated to the cultivation of rice..
If a value can be assigned to the economic good, it can be traded in the market, valuing it through the use of money. These goods are related to saving scarce resources to satisfy human needs.
They are those economic goods that directly satisfy the needs of consumers. They are subdivided into:
They are used in a single act of consumption, such as food, cigarettes, matches, fuel, etc. They directly meet human needs. Likewise, all kinds of services, such as doctors, lawyers, waiters, etc..
They can be used for a considerable period of time. Such products are pens, toothbrushes, clothes, refrigerators, televisions, etc..
Goods can be rivals. This means that they compete with each other for a desired outcome. Therefore, it can be defined as the competition that exists between two or more parties for the same goods. That is, the more one person consumes them, the less they will be available to another.
When they are not rivals it means that the production of the good is not competitive. That is, companies do not compete to sell it.
On the other hand, the goods can be excludable. This means that they are discarded from people. Therefore, they are goods that can be excluded from the consumer, either through a price barrier or due to physical restrictions..
When they are not excludable it means that they cannot be reasonably prevented from using them by others.
They are excludable. Consumers can be prevented from accessing the product, preventing those who do not pay for the good from benefiting from it. For example, you have to pay $ 10 for a T-shirt, $ 5 for a hamburger, or $ 500 for a refrigerator. These prices may prevent the customer from using the good.
Furthermore, they are rivals because the supply of the good runs out after each customer consumes it. For example, when you buy a donut from a bakery, there will be one less available for the next customer..
They are not excludable, because consumers cannot be prevented from accessing the good. For example, traffic lights work for every passing driver, without being able to prevent certain drivers from using them. One solution would be to stop each driver and require them to pay before passing, but this is not practical.
They are not rivals either. For example, governments implement flood control systems to prevent certain areas from flooding. After settling in, each resident benefits from this defense.
They are excludable. For example, some private parks charge users entrance to enter. Therefore, anyone who does not pay can be excluded. These goods are made artificially scarce to help produce income.
They are not rivals, because the availability of the good is not affected by a customer's consumption. For example, satellite television. After the consumer pays for his subscription, he can watch television freely. Likewise, its consumption does not affect the ability of another consumer to watch TV..
They are not excludable, in the same way as public goods. For example, wild fishing is considered non-excludable, since it is impossible to prevent others from fishing there as well..
They are rivals in the same way as private goods. For example, the more a person fishes from a wild lake, the less is available for others..
A person who eats an apple consumes that particular fruit, and it is not available for rivals to eat. An apple could be cut and shared, but in the end it is "subtracted" from the economy.
Many products, like a refrigerator or a car, are shared among a small group of people. Other examples of private goods include food, clothing, and durable goods such as a television..
The transmission of television or radio programs by electromagnetic waves is an example of a public good. By bringing media content to those who can receive the signal, television broadcasts are not consumed by any receiver. It is also difficult to exclude who has the right equipment to enjoy the programs.
Other examples are fireworks displays, sewage treatment plants, and global positioning satellites (GPS)..
The cinema is an example of good club; a cinema may exclude people from attending a movie, but the audience does not consume the movie. Audiences are not competing for the movie experience, they are sharing the experience.
A user does not consume the software. However, the history of this good is characterized by making it excludable.
IBM does not monetize the software, focusing on selling mainframes with the software included. However, Microsoft has developed systems to protect the software from being used by those who are not licensed..
Fishing generates prey that is consumed, which is fish, but lakes, rivers and oceans make it difficult to exclude fishing activities. Similarly, groundwater can be drilled and channeled to the surface, but it is difficult to prevent others from consuming from the same source.
Public libraries lend books that are not available to others. The area of tables and chairs in libraries can be busy, although it is difficult to exclude people from them.
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