Non-rivalry
Also called: Non-rival consumption, Non-rivalrous consumption · Topic: Government Budget, Fiscal Policy and FRBM · NCERT: Class 12, Ch 5 "Government Budget and the Economy"
Meaning
Non-rivalry, also called non-rival or non-rivalrous consumption, is a property of a good: one person's use does not reduce the amount left for others. Many people can enjoy the same unit at the same time. So the cost of serving one more user is close to zero. Together with non-excludability, non-rivalry defines a public good, which the market tends to under-supply.
Example
When one family watches a public fireworks show or feels safer because of the national army, that does not reduce anyone else's share of the show or the security. A chocolate is rival: once I eat it, you cannot.
Don't confuse with
- Non-excludability: this is about whether non-payers can be kept out. Non-rivalry is about whether use by one person reduces what others get. A toll road is non-rival (until it is crowded) but excludable.
- Club goods: these are non-rival only up to a congestion point. After that, extra users reduce the benefit for others.
Related concepts
- Allocation function
- Redistribution function
- Stabilisation function
- Public goods
- Private goods
- Non-excludability
- Free-rider problem
- Club goods
- Merit goods
- Demerit goods