It’s important for us all to get the details of economic language correct. For encapsulated in certain phrases are a number of concepts and then also guides to action. Take, for example, the idea of public goods. Here’s one current public intellectual trying to do so:
No one is realistically suggesting that there is an alternative to either of these things. In fact, the exact opposite seems to be the case. People want more of the NHS, better education, functioning justice and social care that works, for example, and they want the government to supply them, not because these things are then free, but because they know that the government is the only agency that is capable of delivering these things universally for the public benefit.
These things are what are called 'public goods', which are a supply of goods (sometimes) and services (more commonly) that are provided without the intention of profit being made to all members of society, usually by a government, but possibly by a private sector organisation.
In more detail, a public good is defined as:
Public goods are a supply of goods (sometimes) and services (more commonly) that are provided without the intention of profit being made to all members of society, usually by a government, but possibly by a private sector organisation.
This is incorrect. Yes, this does matter. Here is Wikipedia on public goods which is a good enough definition:
In economics, a public good (also referred to as a social good or collective good) is a good that is both non-excludable and non-rivalrous. Use by one person neither prevents access by other people, nor does it reduce availability to others.
There’s a difference in those definitions. It’s an important one too.
The Wikipedia - and correct - definition tells us what the problem is. If it’s not possible to stop someone from enjoying the item (excludability) and also the enjoyment by one does not affect the enjoyment by another (rivalry) then it’s near impossible to make a profit from provision. Therefore a purely private producer will - likely enough - underprovide such public goods as against utility maximization supply levels.
We’ve thus a problem and so also one that could - maybe - usefully be solved by judicious government intervention.
In health care, for example, my hip replacement is rivalrous with your - we cannot both be in the operating theatre at the same time and having the same piece of titanium implanted. Clearly, a hip replacement is also excludable as the NHS manages to exclude so many from gaining one for 18 months.
Within health care there are indeed public goods - herd immunity produced by widespread vaccination for example. But it’s the herd immunity which is the public good, not the vaccination. And there are different ways of achieving that - the US largely insists that children must be vaccinated before starting school (or kindergarten etc) and the UK by the NHS doing the vaccinations for free. It might even be that one of those is better than the other as the method - but it’s not the vaccination, something clearly rivalrous and excludable, which is the public good it’s the herd immunity.
The definition is also not that profit is not attempted - it’s that profit is not possible. Vaccine manufacturing companies clearly do profit, it’s the vaccination campaigns where the benefit cannot be monetised nor profitable. Another one of those judicious interventions is concerning invention and novelty. Once the new thing is created then anyone can do it - copy the invention, copy the book or song. Thus we think that there will be less than optimal levels of invention, book or song. So, we institute patents and copyrights. Entirely artificial ownership rights which provide excludability and so create the possibility of profit. Maybe this is the right way to do it, maybe not, but that is the story as to why we do.
Where the public goods problem exists then yes, there is a good argument for that judicious intervention. Which may even, horrors though it be, mean direct government provision of the item. Like, say, defence of the realm. Even though we can all see the problems with that we did try competing private providers and we don’t look back on the Wars of the Roses as being a national good time.
But public goods are not goods supplied to the public, goods good for the public nor even publicly provided goods. They’re goods which are non-rivalrous and non-excludable.
As we say this distinction is important. For if we forget about this initial and original definition of public goods then we end up going down the rathole of Mazzonomics. Which, we think we’ve understood this correctly, insists upon the following. Invention is a public good, therefore government does and should subsidise it. On the grounds that not enough people will do it because of the difficulty of profiting from having done it. OK so far. The conclusion then becomes that government should own all - or some part of - the inventions which it subsidised into existence so as to be able to share in the profit of having done so. Which does seem to us to be remarkably confused. The evidence given being that Darpa works just great over in the US. Which indeed it does but one of the defining features of Darpa is that it never does try to take ownership.
Ho Hum.
Public goods are a useful - even true - concept and where identified there is indeed a whole library full of usefully true arguments for, and of effective plans to, judicious government action. But those all actually apply only when we have in fact identified a public good. Not when someone just wants to argue in favour of more government.
Details matter, pedantry is valid.