How can non-excludability and non-rivalry of public goods guide the optimal decision of governments in policy dilemmas?

Public goods are goods or services that can be shared by many people, and governments manage them for the public good. Policy dilemmas arise due to conflicts between public interests, and solutions are sought through the rationality model and the satisficing model. The satisficing model emphasizes quick decisions and provides strategies that minimize social costs.

 

Unlike use goods, such as food, which are consumed on an individual level, goods or services produced for the collective consumption of many people, such as parks, are called public goods. There are many definitions of public goods, but they are not defined by who provides them, but by the nature of the good or service itself. Public goods have two characteristics: non-excludability and non-rivalry. Non-excludability refers to the characteristic that no one person or group of people can be excluded from using it, while non-rivalry refers to the characteristic that one person’s consumption does not reduce the consumption of others. For example, a park is free for all to use; one person’s enjoyment of it does not make it unavailable to others.
Government public goods policies are intended to serve the public good, and there are two schools of thought about what this good is: the substantive and process theories. The substantive theory views the public good as an absolute value agreed upon by society, such as human rights. The process theory denies the connection between the public interest and a specific entity and emphasizes the proper process of decision-making to discover the public interest. This notion of the public interest is an important criterion in the policy-making process, and it can shape the direction of policy.
A policy dilemma can arise when one public interest is incompatible with another, or when the conflicting interests are equally important, even with due process. A policy dilemma is a difficult choice between incomparable values or alternatives, where the choice of one alternative is difficult because the opportunity cost of the unchosen alternative is high. If this situation persists, it can lead to delays or controversies in policy implementation, increasing the overall cost to society. Therefore, governments have been continuously exploring ways to get out of policy dilemma situations.
Among the various approaches to resolve complexity and uncertainty in policy making, the rational model explains that the optimal alternative can be selected in a dilemma situation by ensuring the adequacy of the causal relationship between policy goals and means. The idea is that if decision makers are given enough time, budget, and information, they can examine all possible alternatives and therefore make rational decisions. However, in reality, these ideal conditions are rarely met, so real-world policy decisions are often satisfactory rather than theoretically optimal.
The satisficing model, on the other hand, emphasizes decisions at the satisficing level rather than the optimal level because the situations assumed by the rational model never arise. The quick decisions of decision makers in choice situations are viewed as positive for society because they remove uncertainty from policy decisions, regardless of the moral or logical nature of the decision. Whatever the decision, the expectation is that the market will allocate resources in an efficient manner. The satisficing model recognizes these realistic limitations and attempts to overcome policy dilemmas by making suboptimal choices.
The continuation of policy dilemmas rapidly increases the cost to society as a whole. In the real world, the cost of prolonging a dilemma increases dramatically, as the amount of time available for consideration becomes infinite with sufficient budget and information. In this sense, the satisficing model can be adopted as a strategy for decision makers to avoid getting stuck in a dilemma, rather than a decision that is forced to be accepted due to lack of time and budget. It is an approach that takes into account the realistic limitations of policy making and reflects an effort to minimize social costs through quick decisions.
In conclusion, the nature of public goods and the definition of the public interest play an important role in the policy-making process. The non-excludability and non-rivalry of public goods are key factors that governments should consider in formulating and implementing public goods policies to realize the public interest. In addition, in the face of policy dilemmas, the rational model and the satisfaction model provide different strategies according to their respective approaches, through which governments try to find the optimal alternative. This policy-making process is an essential element in promoting the welfare of society as a whole and realizing the public good, ultimately helping all citizens to effectively utilize public goods.