Question

A country is facing a problem — wind is blowing leaves and branches onto the main highway, creating traffic congestion. Some private citizens have worked to clear the road, but the number of cleared miles is well below the socially efficient level. Note that when the highway is clear it is large enough that it is never crowded.

a. What type of good is “a mile of cleared highway.” Explain.

b. Suppose that the country takes its queue from the U.S. and enacts an “adopt the

highway” program, in which, in exchange for maintaining a mile of the highway, a group of citizens will get to have their name posted on a sign next to the high- way. Appealing to the concepts learned in class, explain why this program may result in an increase in the number of miles cleared.

Answer 1

1. ‘ A mile of cleared highway’ is a Public Good

2. This program may result in an increase in the number of miles cleared due to the simple concept of accountability and marketing benefits.

With the Adopt A Highway Program you can have your company name and logo seen by hundreds of thousands of drivers in the community. This in turn gives you the ability to increase your brand visibility, boost your Corporate Social Responsibility efforts, and grow your business. It also reinforces positive impressions when consumers know that you are doing good for the community. It helps businesses build successful environmental programs through roadside sponsorships and will give you a smart and effective way to connect your business to environmental change.