Demerit Goods

This refers to goods or services which are considered to have a negative impact on individuals or society.

Depending on the values of society at a point in time, Demerit Goods might include cigarettes, alcohol, gambling etc. The negative impacts of Demerit Goods are typically underestimated by individuals, resulting in government intervention to reduce demand or restrict supply.

Demerit Goods is a term normally found in business economics and financial management.

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