a level economics Watch
Use the extracts and your knowledge of economics to assess whether local authorities should continue to provide public libraries? (25 markers)
Past exam paper 2018 June as.
Public good is a good which is seen as non rival and non excludable. It is provided by the government.
Positive externalities is benefits to the third parties outside the price mechanism.
Market failure is when the price mechanism leads to a misallocation of resources.
Information gaps is when someone is not aware of the costs and benefits of their decision
One reason why local authorities should continue to provide public libraries is because libraries provide information and can be helped to support the local society and community. As stated in extract B libraries ‘’ provide support for business, health information ‘’ and ‘’ promote long life learning and help to live healthier and happier lives ‘’. Libraries have many external benefits to consumers , firms and potentially the government . If libraries help people live healthier this would mean that they are able to improve their standards of living and help with the information gaps as it makes people aware of how to improve their health. Firms would also benefit as if workers. Are aware of how to improve their health and how to live healthier it would improve the productivity of the workers. They would be more active and less able to feel tired or call in sick. Which could help improve the profits and outputs for the business. Also having more life long learning increasing their knowledge which could be used to make new innovations for the firms . Which could help bring in overall more sales and revenue for the business and more profits. The government would also benefit as it would mean it would help increase tax revenue. If more people are aware of their health it would mean that there’s less people out of work for illnesses or unemployed from illnesses. Which will help improve the government budget deficit and the government could be able to use the tax revenue money and invest in other public goods and services for society. Such as ohs, education , roads . Overall it would be beneficial for external parties such as the government , consumers and firms if the local authority continues to provide pubic libraries
Despite this, local authorities shouldn’t continue to provide public libraries because public goods like libraries can be seen to be excludable and rival for instance spaces of seats at libraries could be filled which would mean that not everyone would benefit from its service .Also books could be issued out which would mean that some people would have to wait their turn to borrow the book. Which causes inequality of learning as the person that borrowed out the book could decide not to bring back the back or continue to reissue it. It would also affect the government as the government would have to spend more money providing more books which would worsen the governments budget deficit and also mean the government would have less money investing in public goods.
Another reason why the government should continue to provide public libraries is that not many people might have other substitutes or alternatives such as stated ‘’ 11% of the uk population lack internet access’’ also ‘’ many people in rural areas rely on mobile libraries’’. These people that rely on libraries to get information and knowledge will suffer without these libraries. It would mean that they won’t find ways to access information like the more privileged which could cause inequality and causing less people to gain information and knowledge. If less people are educated in the long run it would have more external costs such as firms not being able to increase their profits or increase their innovation to get them sales , they would also have a less educated workforce which could ultimately lad to reduction in productivity for firms . The government would face issues such as high employment rates in which the government budget deficit would worsen as they would have to pay benefits , they would also have less tax revenue- from income tax. Consumers would be affected as they would have a low standard of living and less disposable income and not being able to achieve their inner goals.
Despite this the local authorities shouldn’t continue to provide public libraries because as stated in extract a the percentage of people aged 16-24 and 75+ visiting libraries has decreased. With 16-24 having a decrease in demand for libraries by 36% from 2008/2009 to 2015/2016. Whilst aged 75+ there had been a decrease of 2%. Regardless of this it shouldn’t be an indicator to stop using public libraries as even though the number decreased people are still using its service .
Another reason why local authorities should stop providing public services is because there’s more substitutes and alternatives to public libraries . As stated in extract b ‘’ reasons why fewer people are using libraries include getting books from elsewhere including ebooks ‘’ This shows how there’s. Now other ways to get books than going to the library which can be accessible to people in their own comfort . Technology has meant that people are able to access as many books and knowledge in the internet. Which again is showing how demanding for libraries is falling.
Despite this the local authorities should provide public libraries because by cutting it down is resulting in many people losing their jobs. As stated in extract c ‘’ there were 1241 paid library jobs in 2010 but only 979 in 2016’’ which is a 269 people out of jobs. Which might affect many of these workers confidence and they might find it difficult to find another job. if staff are left redundant it will decrease their living standards and decrease their disposable income. It would also worsen the government budget deficit as the government might have to pay out benefits to those left unemployed.
Overall, the local authorise should continue to provide public libraries because it will help benefit the government bringing in more tax revenue as people would be employed. It would also help improve the government budget deficit and lastly the consumes that are less privilege would have access to the libraries to embrued their knowledge. Which will help promote equality to knowledge and ways to improve their education.