0

I realise that this is a broad abstract question, so please allow this example, from which I hope to learn the general lesson and bigger picture.

Some vital community goods, such as defence, police, justice and national parks, cannot be adequately provided through the market. This is mainly because it would be impossible to charge a price since ‘free- riders’ cannot be excluded. Indeed, in most advanced countries, the state usually goes further. Thus it may take responsibility for public goods, such as TV programmes and parks, where there is no reduction in the quantity available for others when one person has more, and the cost can be covered by taxation. Moreover, it usually provides a safety net when people are unemployed, sick or old, and gives assistance towards merit goods, such as education, housing, museums and libraries, on which people might otherwise underspend.

Which of the following can be inferred to be a reason why it is desirable for the government to invest in merit goods?

(b) They benefi t society as a whole (d) It is more effi cient for them to be provided by the government

(b) CORRECT. The nature of the merit goods referred to (education, housing, museums and libraries) suggest that they include a number of things which are beneficial to society as a whole.
(d) INCORRECT. It is not necessarily more efficient for merit goods to be provided by the government, as demonstrated by the fact that policies of privatisation have been pursued by successive governments. The issue is that some degree of government investment is likely to be required.

  1. The quote never defines 'merit goods', so how is (b) correct by inference? Does the explanation overreach? Or do I misinterpret 'inference'?

  2. Doesn't the explanation in (d) overreach? Anyhow, I thought that (d) could be successfully inferred. According to the quote, without the government, the bolded happens, and thus is inefficient, because there are no goods! However, once the government enters, then these goods are provided. Isn't this a logical inference?

1 Answer 1

3

The unstated conclusion is that some vital community goods should be government-provided. On the face of it, one might suppose that (b) does not strictly follow, since the support on offer includes nothing in particular about 'society as a whole.' The evidence offered refers explicitly to individuals in the society (potential free riders, quantities accessible by individuals, individuals requiring a safety net). Thus, one might say that concluding (b) amounts to committing the fallacy of composition [arguing from premises about the 'parts' of something to a conclusion about the whole].

One can, however, legitimately conclude (b) on the basis of a savvy analysis of the evidence. The analysis goes like this: The paragraph states that governments can be concerned with those "public goods. . . where there is no reduction in the quantity available for others when one person has more..." If we take this as meaning 'public goods that benefit society as a whole,' then (b) reasonably follows. This analysis is reasonable because the evidence offers a particular way of understanding the relationship among 'parts' of the whole [while some individuals may have greater access, this fact does not diminish anyone else's access, thus all are benefitted].

While (d) does not follow from the evidence offered, the reason given for this judgment is itself problematic. That a government has 'pursued a policy of privatisation' with regard to some industry is no proof of its efficiency. A better reason for saying that (d) does not follow is that the evidence provided is insufficient for one to draw that conclusion. Without further information about what makes a policy 'efficient' no reasoned claims about the efficiency of this policy [privatisation] versus that policy [government provision] can be made.

I hope that this helps!

You must log in to answer this question.