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1.3.3 Public goods

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Question 2

Extract B

The role of national seismic monitoring and earthquake early-warning networks

The state-funded National Seismic Institute (NSI) operates a vast network of underground seismometers and GPS stations. The NSI is funded entirely through general taxation. When a tectonic shift is detected, the NSI's automated systems instantly broadcast public earthquake early-warning (EEW) alerts directly to mobile phones, public sirens, and radio stations.

These life-saving alerts are sent across open broadcast channels, meaning they are immediately accessible to anyone within the signal range. No individual or business can be prevented from receiving these alerts once they are broadcast. Economists argue that without central state intervention, private firms would fail to construct and operate such a comprehensive warning network due to the free-rider problem, despite its massive social benefits.

The NSI's charter establishes its public-service objectives:

  • To provide immediate, seconds-of-advance warnings to shut down high-risk infrastructure (e.g., high-speed trains, gas lines) before shaking begins
  • To maintain open-access seismic research data for universities and engineers worldwide
  • To coordinate regional emergency services with precise epicenter and damage estimation maps

'National earthquake early-warning systems and public seismic databases are a public good.' Assess this statement.

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1.3.3 Public goods Questions

  1. A Level
  2. /Economics
  3. /1.3.3 Public goods