dessskris Posted January 16, 2011 Report Share Posted January 16, 2011 I need to draw the diagram of underprovision of merit goods but I can't find it in my notes and I don't have my textbook at home I can only find the diagram of positive externality where there are MPB, MSB and MPC=MSC curves, MSB>MPB and there is a spillover benefit. Are they just the same? If not, what is the diagram of underprovision of merit goods like? I am not too sure because I was absent when my teacher gave us this worksheet so I may have missed some information. It would be awesome if you could explain it to me. Thank you! Reply Link to post Share on other sites More sharing options...
Keel Posted March 13, 2011 Report Share Posted March 13, 2011 (edited) I need to draw the diagram of underprovision of merit goods but I can't find it in my notes and I don't have my textbook at home I can only find the diagram of positive externality where there are MPB, MSB and MPC=MSC curves, MSB>MPB and there is a spillover benefit. Are they just the same? If not, what is the diagram of underprovision of merit goods like? I am not too sure because I was absent when my teacher gave us this worksheet so I may have missed some information. It would be awesome if you could explain it to me. Thank you!The topic's a bit old now but it wouldn't hurt to reply. I'm surprised no one responded.You can use the consumption:Or the production:Both show how the merit good is under provided at Q1 when social optimum is at Q*. Edited March 14, 2011 by Keel 1 Reply Link to post Share on other sites More sharing options...
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