Rival Good

A rival good is a good that's your sworn enemy.

Okay, not exactly. If someone tried to take a good from you, and that meant you would be getting less of the good, it’s a rival good. Using a rival good means that others can’t use it.

For instance, a hot dog at the fair. If you eat it, nobody else can have that hot dog. Sure, you could share it, but it’s still a rival good. You each only would get half of a hot dog, say 0.5 utils each instead of the 1 util that comes with a whole hot dog. Rival goods have only so many utils to go around. They're limited in the utils they can supply.

Many goods are rival goods. Pretty much all food. Only one person can wear a shirt at a time, so things like clothes and most personal items are too.

Whoa, check out those fireworks (you’re still at the fair). At first, only a dozen people see the fireworks. They get 1 util each, which means the fireworks gave out a total of 12 utils. As they kept going, more and more people started watching. 50, then 100...each person getting a util. The fireworks went from giving 12 utils to 100 utils.

Fireworks is an example of a non-rival good: a good where others consuming it doesn’t prevent you from consuming it. Just because others are enjoying the fireworks doesn’t mean you can’t. You totally can. And you do. The internet, national parks, and streets are all non-rivalrous goods too.

Whether a good is rival or non-rival determines a lot about its price, how the good is handled by sellers, and how the good functions in the market. Consumers compete for rival goods in the market, matching up consumers with products to consume. With non-rival goods, free riders become a problem for sellers. Say people had to enter the fair to pay to see the fireworks show, yet there are people standing right outside the fairgrounds watching the fireworks show for free. You might see sellers trying to choose where to put the fireworks show to limit who sees them, in order to incentivize people to pay if they want to consume.