Club It Part Two

Market Structure: Team D Paper

Learning Team D:

Dana Groves, Kenyetta West, Philip Messer, Tara Boulton

ECO/212

April 25, 2011

Dennis Brock

Market Structure: Team D Paper

Goods and services are produced and consumed in a vast number of industries around the world. This paper will examine the types of goods and services that industries produce, the supply and demand of labor in industry, and the market structures that describes these industries.

Goods and services can be classified as private goods, public goods, quasi-public goods, and common resources (Hubbard and O’Brien, 2010, p. 148). Private goods are private because they exhibit the concepts of both rivalry and excludability (Hubbard and O’Brien, 2010, p. 148). By “rivalry”, economists mean that consumption of a good by one consumer prevents another from consuming it as well. A cheeseburger is a good example; if one consumer eats it, another consumer cannot. By “excludability”, economists describe the fact that the benefit of an excludable good can be denied to anyone who doesn’t pay for it. Again, the cheeseburger, as a private good, provides a good example; only the consumer who eats the cheeseburger gains the nourishment from it. Public goods exhibit neither rivalry nor excludability (Hubbard and O’Brien, 2010, p. 148); like the interstate highway system, one consumer’s use of a public good does not prevent another from using it, nor can someone who didn’t pay for the good, like a tourist who does not pay U.S. taxes, be prevented from using it. Quasi-public goods are not rival but they are excludable (Hubbard and O’Brien, 2010, p. 148). A toll road is an example; as many drivers as desire may pay to use it, but those who do not pay can be caught at a toll booth and denied its use. Common resources are rival but not excludable (Hubbard and O’Brien, 2010, p. 148). Fish in international waters are an example; if one fisherman catches a fish and eats it, another fisherman cannot. However,...