Rajasthan BoardEnglish MediumSTD 12 Humanities & CommerceEconomicsInfrastructure4 Marks
Question
Highlight important features of the infrastructure sector.
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Answer
Following are the important features of infrastructure:
Public Goods: Most of the physical infrastructure services have some elements of public good in them i.e. it is not always possible to exclude those consumers who chose not to pay for them.
Externalities: The social benefit of the infrastructure services is more than the cost involved in their generation. It makes it difficult to price them economically.
Monopolies: Monopolies are more prevalent in infrastructure.
Public Sector Domination: Public sector dominates in supply of infrastructure due to above mentioned features.
Lumpy Investment: Infrastructure projects are such that any expenditure on a part of the project is not useful until the whole project is ready for operations.
Indivisibilities: It means one can not divide and sub-divide such projects in small parts and activate them.
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