How does the market fail
to provide public goods?
The market fails to provide public goods because they are non-excludable and non-rivalrous. Non-excludable means that it is impossible to prevent people from consuming the good, and non-rivalrous means that one person's consumption of the good does not reduce the amount available for others. This means that it is difficult to charge people for the good, as it is impossible to exclude those who do not pay. As a result, the market does not provide an incentive for firms to produce public goods, and they are often under-provided or not provided at all.