Nonexcludability

Nonexcludability is a property of a good or service that makes it difficult or impossible to prevent nonpaying individuals from accessing it once it is provided. In practice, it commonly characterizes public goods and some common-pool resources, though degrees of nonexcludability vary with technology and policy. A nonexcludable good may also be nonrivalrous, meaning one person’s use does not reduce another’s, as in many public goods, or it may be rivalrous, as in a fishery, where consumption diminishes availability.

Because users cannot be excluded from benefits, markets have little incentive to pay for the good, leading to the free-rider problem and under-provision. This creates a classic market failure: the socially optimal provision would require collective funding or regulation rather than voluntary purchasing. Policy responses include government provision financed by taxation, regulation, or the creation of property rights or fees that segment access. Some goods are quasi-public or club goods: excludable but nonrival, allowing selective provision.

Common examples include national defense and street lighting, which are typically nonexcludable and nonrival; clean air in large regions; and fisheries or grazing that, without limits, can be overused. By contrast, purely excludable goods (private goods) do not exhibit nonexcludability, and purely nonexcludable, nonrival goods (ideal public goods) are relatively rare in practice. The concept remains a foundational tool in public economics for analyzing how goods should be financed and supplied, and why government or collective action is often needed to ensure essential services are available.