In economics, a free good is a good that is not

scarce In economics, scarcity "refers to the basic fact of life that there exists only a finite amount of human and nonhuman resources which the best technical knowledge is capable of using to produce only limited maximum amounts of each economic good. ...

, and therefore is available without limit. A free good is available in as great a quantity as desired with zero

opportunity cost In microeconomic theory, the opportunity cost of a choice is the value of the best alternative forgone where, given limited resources, a choice needs to be made between several mutually exclusive alternatives. Assuming the best choice is made, ...

society A society () is a group of individuals involved in persistent social interaction or a large social group sharing the same spatial or social territory, typically subject to the same political authority and dominant cultural expectations. ...

. A good that is made available at zero price is not necessarily a free good. For example, a shop might give away its stock in its promotion, but producing these goods would still have required the use of scarce resources. Examples of free goods are ideas and works that are reproducible at zero cost, or almost zero cost. For example, if someone invents a new device, many people could copy this invention, with no danger of this "resource" running out. Earlier

schools of economic thought In the history of economic thought, a school of economic thought is a group of economic thinkers who share or shared a mutual perspective on the way economies function. While economists do not always fit within particular schools, particularly in ...

stated that resources that are enough for everyone to have as much as they want are free goods. Examples in textbooks included seawater and

air An atmosphere () is a layer of gases that envelop an astronomical object, held in place by the gravity of the object. A planet retains an atmosphere when the gravity is great and the temperature of the atmosphere is low. A stellar atmosph ...

Intellectual property Intellectual property (IP) is a category of property that includes intangible creations of the human intellect. There are many types of intellectual property, and some countries recognize more than others. The best-known types are patents, co ...

laws such as

copyright A copyright is a type of intellectual property that gives its owner the exclusive legal right to copy, distribute, adapt, display, and perform a creative work, usually for a limited time. The creative work may be in a literary, artistic, ...

s and

patent A patent is a type of intellectual property that gives its owner the legal right to exclude others from making, using, or selling an invention for a limited period of time in exchange for publishing an sufficiency of disclosure, enabling discl ...

s have the effect of converting some intangible goods to scarce goods. Even though these works are free goods by definition and can be reproduced at minimal cost, the production of these works does require scarce resources, such as

skilled labour Skill is a measure of the amount of worker's expertise, specialization, wages, and supervisory capacity. Skilled workers are generally more trained, higher paid, and have more responsibilities than unskilled workers. Skilled workers have long had ...

. Thus these laws are used to give exclusive rights to the creators, in order to encourage resources to be appropriately allocated to these activities. Futurists like

Jeremy Rifkin Jeremy Rifkin (born January 26, 1945) is an American economic and social theorist, writer, public speaker, political advisor, and activist. Rifkin is the author of 23 books about the influence of scientific and technological changes on the eco ...

theorize that advanced

nanotechnology Nanotechnology is the manipulation of matter with at least one dimension sized from 1 to 100 nanometers (nm). At this scale, commonly known as the nanoscale, surface area and quantum mechanical effects become important in describing propertie ...

with the ability to turn any kind of material automatically into any other combination of equal mass will make all goods essentially free goods, since all raw materials and manufacturing time will become perfectly interchangeable.

References

{{DEFAULTSORT:Free Good Goods (economics)

See also

References