Public production is justified when services are socially desirable but not privately profitable—often due to scale economies or large capital requirements (e.g., the interstate highway system, orphan drugs)—so government provision is argued to enhance total utility even if it loses money, because social benefits exceed the subsidies provided.

definitionpending

Speaker

Clifford Winston

Evidence Quote

the production of these Goods leads to social benefits that exceed whatever subsidies the public is going to provide

Source

Clifford Winston on Market Failure and Government Failure 12/28/2009EconTalk
Created: 6/15/2026, 9:37:54 AM

My Notes

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