Is it possible to ration public goods? If yes what devices will you use to ration them? If not, why?

ENGR.ECONOMIC ANALYSIS
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ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
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Is it possible to ration public goods? If yes what devices will you use to ration them? If not, why?

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Step 1

1.Yes it is possible to ration public goods.

Ration of public goods means that government will reduce the price of such goods,or control demand and supply of public goods through different rationing channels.

Example of public goods include railways,foodgrains,public buildings etc.

 

Step 2

2.Devices used to ration public goods by government:

*Subsidies:

A subsidy is the reduction in price of a particular good.

Government provides subsidy for public goods such as foodgrains,cooking gas,petrol,railway tickets etc.

For example if price of rice is 10 $ per kg.Government will introduce subsidy and price of rice will be reduced to 2 $ per kg.In this way rationing of rice will take place.

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