An Analysis of Government Interventions in Addressing Market Failures Caused by Non-Excludable and Non-Rivalrous Public Goods Based on COVID-19 Vaccination Cases


Public goods
Free rider




The non-excludable and non-rivalrous characteristics of public goods distinguish them from private goods. The existence of these two characteristics leads to the “free rider problem” and the variation problem, making the market supply less than the actual demand, thus causing market failure. The government should therefore intervene against this impact. At the beginning of 2020, the global outbreak of the novel COVID-19 brought significant harm to various countries, races, and groups of people. In the second half of 2020, several companies developed vaccines, which are able to fundamentally block the transmission of the virus. However, as vaccines have been reducing the severity of the epidemic in certain regions, the situation somewhat reflects non-excludability and non-rivalry, in which before officially being listed in vaccination programs, the society may have the thought of “vaccination would reduce the risk of transmission; thus, I can enjoy the reduced risk of everyone being vaccinated without paying for it.” For this reason, most countries have been purchasing vaccines for the public through government appropriations to solve the free-rider problem. It can be said that in the face of market failure caused by public goods, the government should carry out timely intervention measures, including taxation and government appropriation, to avoid negative impacts from the characteristics of public goods.


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