Political Institutions and Public Good

This essay examines the relationship between political institutions and public goods. It defines political institutions as organizations that create, enforce, and apply laws, mediate conflicts, and develop government policies. Public goods are defined as non-rivalrous and non-excludable goods, such as clean air and education. The essay explores how public institutions provide public goods and their impact on society domestically and internationally, highlighting their role in poverty reduction and environmental protection. It further analyzes how the demand and supply of public goods are influenced by external, environmental, economic, and political factors, including tax policies, environmental laws, inflation rates, and population growth. Finally, the essay discusses Arrow's impossibility theorem and its implications for the political process, explaining how it affects decision-making in scenarios with multiple preferences.

Running Head: Political institution and Public good
POLITICAL INSTITUTIONS AND PUBLIC GOOD

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Political Institutions and Public Good
The organizations formed with an aim for creating, enforcing and applying the laws in a
mediating conflict which being in addition for making the government as well as the policies
either on the economy or other social system for the population is political institution. An
instance includes the trade unions, legal courts and the political parties.
In the field of economics, a public good is neither considered a rival good or a form of non-
excludable good where the public cannot be effectively disregarded from the use or where one
person cannot be said to reduce his availability to the other. It is identified by the nature that its
usage by one person does not possibly minimize the degree or the quantity that should be taken
in by the orders (Halonen, 2012). Instances could include fresh air for breathing, education,
lighthouses, street lighting, common lingo etc.
Public goods provided by public institutions and how these public goods impact society
domestically and internationally
Public good is one scenario which is important for removing poverty from society and thus helps
in the creation of positive market integration be it at domestic or international level. The other
scenario for providing a helping hand includes the protection of the global economic
environment and is usually done by the way of facilitating the management of the environment
and other important components for reducing the poverty. An example that could be cited
includes the long term impact over the health sector (Hyman, D. ,2014). For a positive change it
is of paramount importance for ensuring the provision of the public good which further allows
the fostering of technical knowledge either domestically or internationally and further ensures
the society for overcoming the diverse failures in the market.

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How demand and supply of public goods are influenced by external, environmental,
economic, and political factors
The demand as well as supply of public good is driven by external, environmental, economic as
well as political factors. Factors such as policies of tax, environment laws, tariffs etc. are
political in nature and helps in the determination of how as well as the kind of public good is
available. Factors such as inflation rates, interest rates as well as exchange rates are economic in
nature thereby affecting the demand for public good. The population growth, age distribution as
well as safety access are social factors affecting the demand of the public good. The above
mentioned elements impact as well as establish the degree of the company’s need of investment
along with productivity (Sen, A. (2009)).
The Arrow’s impossibility theorem, and how it can affect the political process
An idea in a social choice theory as per which the citizens have either three or more
differentiated opinions or choices and where there is no presence of the ranked order voting
system thereby leading to rankled preferences of persons over a community wide position as an
addition for meeting a pre-specified criteria is the arrow impossibility theorem. The political
procedure is affected by the application of this principle by way of dealing with all imaginable
regulations under a usual structure. This gives the purposeful device for revealing social well-
being.

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References
Hyman, D. (2014). Public Finance: A Contemporary Application of Theory to Policy (11th Ed.).
Stamford, Cengage Learning.
Sen, A. (2009). Personal Utilities and Public Judgments: or What's Wrong With Welfare
Economics. The Economic Journal, 89, 537-588.
Halonen, M. (2012).Nature of human capital, technology and ownership of public goods.
Journal of Public Economics. Fiscal Federalism 96 (11–12): 939–945.