PUBLIC GOODS ARE GENERAL GOODS AND SERVICES AVAILABLE FOR COMMON CONSUMPTION TO THE PUBLIC. THEY ARE NON RIVAL AND NON EXCLUDABLE .NON RIVAL MEANS THE CONSUMPTION OF ONE INDIVIDUAL WILL NOT AFFECT THE CONSUMPTION OF OTHER.NON EXCLUDABLE MEANS THAT NO ONE CAN BE EXCLUDED FROM IT'S CONSUMPTION.EXAMPLE OF PUBLIC GOODS ARE PUBLIC ROADS , PUBLIC PARK ETC.

             PURE PUBLIC GOODS ARE FULLY NON RIVAL AND NON EXCLUDABALE IN CONSUMPTION. FOR EXAMPLE , PUBLIC ROAD. BUT IMPURE PUBLIC GOODS ARE PARTIALLY RIVAL AND PARTIALLY EXCLUDABLE . FOR EXAMPLE, FEE PAYING PUBLIC PARK AND TOLL ROADS. GOVERMENT PROVIDES BOTH PURE AND IMPURE PUBLIC GOODS. IT IS IN ACCORDANCE WITH THE NEED OF THE SOCIETY. FOR EXAMPLE, NATIONAL DEFENCE IS A PURE PUBLIC GOOD.BECAUSE ALL THE CITIZENS ARE BENEFITTING EQUALLY AND NO ONE IS EXCLUDED FROM IT . GOVERNMENT MAY PROVIDE A TOLL BRIDGE WHICH IS CONSTRUCTED ON B.O.T ( BUILT OPERATE AND TRANSFER) BASIS BY A PRIVATE PARTY. THIS IS AN EXAMPLE OF GOVERNMENT PROVIDING IMPURE PUBLIC GOODS.

SINCE PUBLIC GOODS ARE NON EXCLUDABLE AND NON RIVAL THEY CANNOT BE PROVIDED BY THE PRIVATE SECTOR. SO THE GOVERNMENT MUST PROVIDE THEM TO THE PUBLIC. THE PUBLIC MUST SHARE THE COST OF PUBLIC GOODS. GOVRNMENT TAX REVENUE CAN BE USED FOR PUBLIC GOODS. THIS IS USED IN CASE OF A PURE PUBLIC GOOD LIKE NATIONAL DEFENCE. GOVERNMENT ITSELF OR THE PRIVATE SECTOR CAN BE PAID FOR THIS PURPOSE. GOVERNMENT CAN COLLECT AN EQUAL PROPORTIONAL INCOME FROM EVERY ONE FOR PROVIDING PUBLIC GOODS. FOR EXAMPLE, IN CASE OF AN IMPURE PUBLIC GOOD LIKE TOLL BRIDGE EACH PERSON IS PAYING THE SAME FOR USING THE BRIDGE.