What is a demerit good?
What is a demerit good?
A demerit good is over-consumed because consumers have imperfect information about its true harm. The label also involves a negative value judgement that society should consume less of the good.
Step-by-step lessons on CIE Intl A Level Economics 1.6.4 nature and definition of demerit goods: over-consumption as a result of imperfect information in the market. Each one builds up to exam-style questions.