free good

Definitions

Economics

  • noun a good which is in plentiful supply and which has a negligible price. Consumers tend to overutilise such goods.

Health Economics

  • (written as Free Good)
    In economics, a free good is not the same as one that is offered free of charge. 'Free good' is used in economics to describe a good that is not scarce ; more of which is not demanded than is already available at a zero price - as much is available as anyone wants. It is therefore not an economic good and it has no opportunity cost. Many goods and services that are offered free of charge are not 'free' in the economic sense, and health care is a classic example (for insured persons). An economic good that is offered free of charge will normally have required scarce resources in its production and there is likely to be an excess demand for it.
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