Private Good
IntermediateA private good is a product or service that is excludable, meaning people who do not pay can be prevented from using it, and rivalrous, meaning one person's use reduces its availability to others.
Most things people buy every day are private goods: food, clothing, phones, cars, haircuts and cinema tickets. If you eat a sandwich, no one else can eat it. And a shop can refuse to give you a sandwich unless you pay.
Because sellers can charge for private goods and each unit can only be used by one person, markets generally provide them efficiently. Producers have a clear incentive to make them, and buyers pay according to how much they value them.
Private goods contrast with public goods, which are non-excludable and non-rivalrous, such as national defence. Between the two are other categories. Common resources, such as fish in the ocean, are rivalrous but hard to exclude people from. Club goods, such as a private gym or streaming service, are excludable but not very rivalrous until they become crowded.
Understanding these categories helps explain why some things are sold in markets, while others are provided or regulated by governments.
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