Distinguish between ‘merit goods’ and ‘demerit goods’. Explain briefly why consumption of merit goods are encouraged and those of demerit goods are discouraged.

Merit goods are the goods that are provided generally by the government to certain sections of the society. Unlike in the case of pure public goods, the merit goods are not provided to the entire society; rather they are given to certain targeted people. The government here believe that the deserving people may under-consume such goods and hence provides these to them at low cost or no cost.

Merit goods :

The concept of merit goods in economics was introduced by an American economist Richard A. Musgrave. Musgrave was a leading public finance specialist. He divided public goods or wants into social goods (wants) and merit goods (wants).

Merit goods with non-exclusion principle and their supply is jointly made.

Merit goods: are those public goods which results in interference with consumer choices. Here the government will be providing the goods (merit) to specific section of the society because of their backward status, poverty etc (depending on their merit).

An example for merit goods or wants is the government’s expenditure in the educational sector (like the Sarva Shiksha Abhiyan) for the schooling _______ ________ ________ __________ __________ ________ ____ ________ _____ ___ ____.
______ ___ _____ ___ ________ ___ ______ _________ ____.
______ ____ _______ _______ __________ ___ ___ ________ ___ ___ _________ _________.
____ _______ __________ ______ _________ _____ ______ ______ _______.
_____ ________ ___ ____ ______ ________ _________ _____ _______ ____ _________ ___.
______ ____ ___ ____ _____ ___ __________ ___.
____ _____ ______ _______ _____ ____ _________ ____ ___ _______ ________ __________.
____ ___ ___ ________ _______ ________.
___ _______ ______ ____ _____ __________ ________ __________ _____.
_________ _____ ___ ________ ________ _________ ____.
__________ _______ _________ ___ _______ ____.
_______ ____ __________ _________ ____.
_________ _______ __________ _____ _______ ________ ________ ______ ______ _______ ___ ____.
__________ ______ _______ __________ ____ ___ ________ _____.
_____ _________ ___ ____ _________.
_______ _______ ______ _____ _____ _____ _______.
__________ ___ __________ _______ ________ __________ _________ ___ ___ _______ ___.
_______ _____ ________ ______ _______ ___ ________ _______ ________ ___ _____.
_________ ________ _________ ____ _______ ________ _______ ___ ___.
______ _______ _________ __________ ____ __________ _______.
_________ _________ _______ ___ ____ __________ _______.
________ _________ _______ _________ _____ _________ __________ ___ ____ ________ ______ ____.
_________ __________ _______ _________ _______.
_________ _______ ____ _________ _______ _______ _____.
________ _________ _________ _______ ________ _____ ____.
_____ ____ _________ _________ ________ ___ ____ ___ _______ _________ ________.
________ ______ ____ __________ __________ ________.
______ _____ _______ __________ _____ ____.
_________ _____ _____ _______ __________.
_____ _________ ___ ____ __________ ________ _______ ___ _____ _______.
____ ___ ______ ____ ____ __________ ____ ________ _______ _________ _______.
___ ________ _____ __________ ____ ______.
__________ ___ _____ _________ _______ __________ ____ ___ _______ ____.
_________ _____ _____ _______ ______ _________.
___ ____ ____ _____ _____ _____ ____ __________.
_______ ________ ____ ________ __________ _______ __________.
_________ ________ _________ _______ _______ ___ ______ ____ ___ ___.
________ __________ ____ ____ ____ _________ _______ ______ ____.
________ _______ _____ _________ ______ _____.
________ __________ __________ ______ _____ ___ ________.
_______ ___ __________ _________ __________ __________ _______ ____ ______ _______ _________ _____.
_____ ______ ________ _______ _________ ______ _______ ____.
_________ __________ _______ ________ __________ ___ _____ ___ ______.
____ ______ ________ _________ ______ ________ _______ ________ _____.
_____ ________ _____ _____ ___ _______ _______ ____.
_____ _________ _____ _____ __________ ______ ________ _______ _________ __________.
______ ______ ____ ____ _____ _____ ____ _________ ________ _________ __________ _______.
____ _________ _______ ___ ________.
______ _________ __________ _______ ________ _____ ______.
____ _____ _______ _______ ________ ________ ____ __________ _________ __________ __________ __________.
______ ________ _______ ____ ____ _____ _______.
___ ______ ______ ________ ________ _________ _______ _______ ______ ________.
_________ ________ __________ __________ __________ ______ ________ ______ _____ ______ ______.
__________ ______ ____ _________ __________ ________.
______ ___ _____ _______ __________.
____ ______ _______ _____ _______ __________ ________ _______ __________.
__________ _____ _______ _______ ______ ______.
_________ ___ __________ ________ _____ _______ _______ _________ ______ ____ ______.
______ __________ ______ ____ ____ _______ ______ ________.
__________ __________ _________ _______ _______ _____ ____ _____ _________ _______.
_______ ________ _________ _________ __________ ______ _____ ___ __________.
__________ ___ _______ ____ ____ _________.
_________ ________ _________ _________ ___ ______.
_____ ____ ________ ___ __________.
____ __________ ______ ______ __________ ____ ___ ______.
_______ ___ ______.
Get Full Answer on WhatsApp