Question 1: Public Goods and Services


Criminal acts affect the welfare of the general public. As a result, its prevention is considered to be a public good. Public goods and services are those goods and services that are provided by the government as a result of a total or partial market failure for the provision of the good or service. Besides, these are the goods and services that the public best benefits from when they are being provided by the government than when they are privately being provided (Maculan & Gil, 2020). An example is education, which can be efficiently and successfully provided privately but the public will not benefit well from the private provision. Thus, it is better provided by both the government and the private market Public Goods and Services Essay Sample

. The provision of public goods and services is also based on the general interest of the public where it is in the best interest of the public that these goods and services be provided publicly, with no other market. An example is the police or military. In the interest of public safety and security, this service should only be provided by the public market.

Public goods are provided because either the market cannot provide them or they cannot be sold to the market. What this means is that the goods and services can only be provided by the government (the public) and that the private providers either lack the ability (financially or legally) or they are best provided by the government (Anomaly, 2013). An example is the police service or the military, which can only be provided by the government (the public) due to the law associated with public safety and security.

Characteristics of public goods and services

Public goods have particular characteristics that are associated with them. The four main characteristics as outlined by Kaul and Mendoza (2003) are nonexcludable, indivisible, nonrivolous and they have the free-rider problem Public Goods and Services Essay Sample

  1. They are Nonexcludable

It is not possible for the provider to exclude individuals from the use of the public goods and services. Considering that they are provided by the help of the public fund, public goods providers (or the governments) cannot exclude individuals from their consumption. An example is public roads, especially those that are toll free. Anyone can use the roads since they are nonexcludable.

  1. They are Nonrivalrous

This means that the goods and services can be consumed by many people at the same time and never cause any conflict. For instance, in case of a state-owned radio station, any person who has a radio and is within the range of transmission of the radio station can get the service no matter how many people are tuning in for it. Another example are the street lights. The public can get the light at the same time without depleting the light or causing anyone to feel that they will not be able to use it due to the high number of public users.


  • They are indivisible.

It is not possible to divide the goods into small groups or units that can be sufficiently be sold on the private market. Such goods are too expensive or too large to be provided by the private providers Public Goods and Services Essay Sample

  1. They have the free-rider problem

There are people who do not like paying for some goods and services but still want to use them. These are called free-riders. Public goods suffer, mostly, what is known as the tragedy of the commons, where there is no one in particular who takes responsibility of taking care of them.

Crime prevention activities

Crime is any action that is forbidden by the law. There are different types of crimes, including violent crimes like murder, rape and robbery; offenses against property which include theft and arson; and other crimes like prostitution, impersonation, drug possession and trafficking among others. Crime prevention is a public good because it is provided by the government, through the police and the security personnel (Corbett, 2014).

The most common method that is used to determine the level of crime prevention activities is the cost-benefit analysis method. This method analyses the costs of using certain activities like use of the police in crime prevention against the benefit of the activity. The evaluation of this method is in terms of analysing the costs of specific activities and looking at the advantage that the general public draws from the measures.

The graph below shoes the production possibilities curve for crime prevention.

According to the curve, resources used for crime prevention are not available for other uses. Points A and B indicate how some countries like the United States have moved in terms of resources and crime prevention.

Question 3: Higher Education

Australia offers higher education as a public good, with a subsidized price. This allows more people to have access to the good, which would otherwise be difficult for them to afford. There are several advantages that come with higher education being offered as a public good. One of them is social equilibrium, where there is the bridging of social gaps. Further, higher education has economic and social advantages in Australia (Shah & Lewis, 2010). The following are some of the considerations in deciding to pursue higher education:

  1. Equilibrium

Equilibrium is an aspect of public good where the demand and supply are at an equity. When considering aspects of equilibrium and higher education, the need or demand for the skills and knowledge that have to be achieved through higher education must be considered. The demand for skills can be exhibited through different sectors like ICT, science, innovation, engineering and even in sectors that have a social and cultural value Public Goods and Services Essay Sample

  1. Efficiency

Efficiency is an important factor in the determination of relevance of a public good. The society and the individuals need to find efficiency in the provision of the higher education. As a result of the efficient services and goods, the government will ensure efficiency in the good that it provides for the people.

  1. Resource allocation

Resources are very important in the determination of whether or not to pursue higher education. The availability of resources is a pointer towards the ability to provide and even earn higher education. Higher education requires resources for it to be beneficial to the society and to the economy of the country.

Social and economic benefits of higher education

Higher education is an important element in any society and to the economy of a particular country. The following are some of the benefits of higher education as highlighted by Hill, Hoffman and Rex (2005).

  1. Social development

Education is a key element in the establishment of a society and its eventual growth and development. It is an important marker of prosperity and economic development since the individuals who pursue higher education expand their world views, making it possible to bring progress to their societies. A society is likely to develop if it has more people who have been exposed to the outside world through higher education than if it does not have any people who have pursued higher education Public Goods and Services Essay Sample

Education makes it easy for members of  particular society to abandon retrogressive cultures and traditions in favour of those that are progressive and whose economic and social values are higher, direct and, sometimes, instant.

Sociologists argue that education is an important factor in the attempt to create a conducive social environment for growth and development of both the individual and the society. Individuals who have attended higher education are more likely to solve their issues amicably, thereby having peace among themselves, than those whose understanding of their social environments revolves around their own societies (Breakwell, 2018). Notably, peace is a very important aspect in establishing social development.

  1. New innovations

Most institutions of higher learning ensure that the students are from different social and economic backgrounds and have been drawn from different regions around the country or the world. When people from different social and geographical locations meet, they exchange cultures and ideas. This exchange is important in ensuring that a mix of ideas leads to new innovations and provision of new ways to solve social problems. As a result of individuals from a particular society pursuing higher education in different regions, there are more chances that their innovativeness will be high and this will increase chances of finding new solutions to the problems of their society Public Goods and Services Essay Sample

The level of industry will be higher, increasing the revenue of their individual societies and their country. Citizens who have higher learning skills attract more payments, increasing the tax rates on their salaries and helping their countries to earn more revenue for economic development.

Effect of externalities on equity, efficiency and allocation of revenue

The following graph shows how externalities affect equity, efficiency and allocation of revenue. There are different externalities like demand, supply and equilibrium which affect equity, efficiency and allocation of resources shown in the increase in supply graph below.

According to the above figure, an increase in supply will affect the distribution of resources through a change in prices. The end result will be an uneven distribution of poverty in the society through inequalities in the socio-economic abilities of the members of the society.

Case Study: Morrison is taking the Recovery too Cheaply

  1. Meaning of Recession

Recession is the period of a fall in the economy of a region or a country which is characterised by few or no industrial activities and a fall in the GDP of the country. In the context of this article, “this recession” means the period when the world in general and Australia in particular has suffered the economic effects of the coronavirus pandemic (Fine, 2018). Therefore, recession here refers to the fall in the GDP of Australia that is brought by the closure of industries and loss of jobs by Australians in the middle of this global pandemic.

  1. The JobKeeper wage subsidy scheme

According to the article, several people lost their jobs due to the temporary lockdown that saw industries and companies cutting down the staff members as a result of a sudden drop in the revenues of the companies and industries Public Goods and Services Essay Sample

The JobKeeper wage subsidy scheme saw an expenditure of about $70 billion to prop up the workers and their workers so that they maintain their links. Therefore, as much as they are not in employment, these people are not considered as being unemployed because of two reasons (Cooper and Burrell, 2001). The first one is that they still have the connection with their employers and, by assumption, will take back their jobs once the recession is out. The second reason is that, even if they are not employed back, the money that they are being given still serves the same purpose as that which their employments did, making them appear like people who are still employed. The economic value of this strategy is that the demand for the services will still be high, making the prices (salaries) remain as high as it was before the pandemic. Based on the law of demand and supply, this scheme will easily translate to high revenues for the country due to the prevailing conditions and the buffer that the government has provided through the JobKeeper wage subsidy scheme.

The wage bill has a very important economic value, where it helps millions of Australian families to earn a living from the $70 million that would still be used on other activities had it not been spent on the wage scheme Public Goods and Services Essay Sample

  1. The policy

The policy that is being referred to in the tax cuts is the JobKeeper wage subsidy scheme policy. This policy is about cushioning workers from the effects of the coronavirus during this recession period. However, it is indicated that there is no more money in the Reserve Bank of Australia that can be used to boost the economic status of the people after the use of the $70 billion on the wage scheme. When dealing with the effects of the coronavirus, the government attempted to address the problem of job losses amongst its citizens. The last possible amount that could be used to ensure that the economy was back on track is what had been used on the wages for the people who had lost their jobs. What the government was interested in was to keep the hopes of the people that they still could afford to provide for their families, making it difficult for anyone to describe them as unemployed. The recovery of the economy is, therefore, argued to be a difficult thing since the country is heavily indebted and individuals were also finding it difficult to find any financial bailout.

Morrison lacked the right policies to help the people deal with the temporary lockdown. Deciding to go for the $70 billion was a good thing in the short run but the long terms effects of that wage will be felt in the economy of Australia for longer periods than other recession periods have posted. Prices of houses has suddenly gone up, leaving families with more desperation than what the wage made them feel comfortable about Public Goods and Services Essay Sample

  1. Economic growth and population growth

There is a concept known as ageing population, which is heavily affecting Australia. The economy is supposed to be part of the population with the growth of the population being in tandem with the growth in the economy of the country. However, with a gap in the population, it is difficult to achieve an economic growth since the population is not growing with it (Cubit & Meyer, 2011). Economists estimate that the next few decades will be difficult for Australia because of the population gaps that does   not enable the growth of the economy. It is also based on this reality that this article decries the actions and policies of Morrison on the JobKeeper wage scheme since it lacks a future characteristic.

National accounts figures show that the Australian economy grew by just 0.2% on the last quarter of 2018. This disappointing result was below market expectations and official forecasts of 0.6%. It put annual growth for the year at just 2.3%. But the shocking revelation was that Gross Domestic Product per person (a more relevant measure of living standards) actually slipped in the December quarter by 0.2%, on the back of a fall of 0.1% in the September quarter. These are the first back-to-back quarters of negative GDP per capita growth in 13 years – since 2006, according to data and information available at

  1. Floating Exchange Rate

When a currency has a floating exchange rate, it means that its regime fluctuates depending on the events on the forex market. The Australian currency has this tendency and which helps the country to survive the changing market conditions Public Goods and Services Essay Sample

The price of the currency is not fixed. When the currency floats down, the international market becomes very competitive as a result of the intermediary role that the currency plays on the forex market (Makin & Rohde, 2012). In order to prevent inflation, the currency floats up, making it become the measure for the up limits on the foreign exchange market. Thus, the Australian dollar is important in determining the value of other currencies because it is easy for it to move up and down, adjusting to the market conditions and realities.


Anomaly, J. (2013). Public goods and government action. Politics, Philosophy and Economics, 14(2), 109-128.

Breakwell, P. (2018). Business and the Power of One. Cincinnati: Yale University Press

Cooper, R. and Burrell, G. (2001). Modernism, Postmodernism and Organizational Analysis: An Introduction. Organizational Studies. 9(1), 91-112

Corbett, J. M. (2014). Critical Cases in Organisational Behaviour. London: Macmillan Publishers

Cubit, K. A., & Meyer, C. (2011). Aging in Australia. The Gerontologist, 51(5), 583–589,

Fine, P. (2018). People and the Organisation. New York: Sage

Hill, K., Hoffman, D. L., & Rex, T. (2005). The value of higher education: individual and societal benefits. Productivity and Prosperity Project. Retrieved from

Kaul, I., & Mendoza, R. U. (2003). Advancing the concept of public goods. Pp 78 – 80. DOI: 10.1093/0195157400.003.0004

Maculan, E., & Gil, A. G. (2020). The rationale and purposes of criminal law and punishment in transitional contexts. Oxford Journal of Legal Studies, 40(1), 132 – 157.

Makin, A. J., & Rohde, N. (2012), Has Australia’s floating exchange rate regime been optimal? Economic Modelling, 29(4). DOI: 10.1016/j.econmod.2012.03.006

Shah, M., & Lewis, I. (2010). Private higher education in australia: growth, quality and standards. Journal of Institutional Research South East Asia, 8(2), 80-95. Retrieved from Public Goods and Services Essay Sample

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