Lesson Plan: Who Pays for Progress? Public Goods and the Future of Cities

Subjects:

Economics

• This lesson illustrates the economic concept of public goods, which would be included in an economics unit on market failures. Related concepts in the unit include positive and negative externalities, the Tragedy of the Commons, and monopolies.

Essential Questions:

• What criteria should be used to decide which goods and services should be publicly funded?
• To what extent should governments intervene in the economy to provide public goods?
• How can we weigh the benefits of government interventions against unintended consequences?

Lesson Objectives:

Students will:

• Define the key characteristics of public goods and identify public goods in real-world settings.
• Evaluate criteria for determining whether a good or service should be publicly funded.
• Analyze the potential social and economic costs and benefits of the government providing public goods.

Materials:

• Retro Report video “Future of Cities” (Transcript)
• Student Activity handout
• Poster paper and markers

Procedure:

1. Introduce the concepts of private and public goods to students by having students complete the Frayer models on the Student Activity handout. Review with the class, as necessary:
   1. Public Goods:
      1. Definition: Goods and services that are (1) for the benefit of all members (2) available to all members (use by one does not diminish the amount available for others).
      2. Possible examples: Establishing and operating traffic lights: You can’t have traffic lights that only operate for certain cars; everyone benefits, and nobody’s use of a traffic light prevents anyone else from using the light. Providing for the defense of the country: If you protect the country’s borders from invasion, that keeps everyone safe. You can’t protect only certain people from a missile.
      3. Characteristics or Illustration:
         1. Public goods are non-rival: One person’s use of the good doesn’t reduce the amount available for others.
         2. Public goods are non-excludable: It’s difficult or impossible to prevent people from using the goods, even if they do not pay.
         3. Public Goods | Stanford Encyclopedia of Philosophy
         4. Government investment is typically required to provide public goods.
         5. Non-Examples:
            1. Concert tickets: you can prevent someone from entering the concert without a ticket, and one person sitting in a seat prevents another person from sitting in that seat.
            2. Bottled water: you must purchase the bottle, and once someone drinks it, the water is gone and cannot be consumed by anyone else.
   2. Private Goods:
      1. Definition: Goods and services that (1) must be purchased to be consumed and (2) the consumption of the good or service prevents another individual from consuming it.
      2. Examples: Concert tickets and bottled water
      3. Characteristics or Illustration:
         1. Private goods are rival: One person’s use of the good reduces the amount available for others.
         2. Public goods are excludable: People can be prevented from using the goods if they do not pay.
            1. Public Goods | Stanford Encyclopedia of Philosophy
         3. Non-Examples: Traffic lights & national defense
2. Next, have students watch the Retro Report video “Future of Cities” (Transcript) and answer the corresponding questions on the Activity handout.
3. After the video concludes, review answers as needed. Then, have the class generate a list of public goods in Medellín that were featured in the video. Write each public good on the board. Students will write down the list on their handouts. Students should name the following:
   1. Public transit & cable cars (Metrocable)
   2. Water infrastructure
   3. Power utility (electricity)
   4. Schools
   5. Libraries
   6. Microcredit programs
   7. House of Justice and administrative offices
4. Students will consider the questions listed below individually, then discuss with partners, before sharing responses with the class.
   1. 1. What were some of the effects of the city of Medellín’s providing public goods? Answers may vary, potential ideas include:
         1. Increased mobility and opportunity: A cable car system can connect isolated neighborhoods to jobs, schools and city services, reducing travel time and improving access to opportunity.
         2. Improved safety and social trust: Public investment in infrastructure and legal institutions (like the House of Justice) helped reduce violence and gang control, making communities safer and more stable.
         3. Local economic growth: As safety and connectivity improved, small businesses opened and thrived, bringing jobs and new energy to previously neglected areas.
      2. What are the advantages and challenges of having the government, rather than private companies, provide essential goods and services like transportation, water or sanitation? Answers may vary. Potential ideas include:
         1. No profit incentive for private companies: Building transit lines to poor neighborhoods or providing water infrastructure to informal settlements isn’t profitable.
         2. Equality and access: Government involvement ensures even low-income or marginalized communities receive basic services.
         3. Coordination and scale: Large projects like metros or neighborhood upgrades often require long-term investment and citywide coordination.
      3. What goods or services, if any, do you think the government should provide for the people of Medellín that are not mentioned in the video? Explain.
         1. Answers will vary; potential ideas include: health care facilities, law enforcement, a fire department, sanitation, public housing, parks, street lights, sidewalks/paths, etc.
      4. What are potential reasons why the government of Medellín should not provide the goods and services you mentioned in your response to the previous question? Answers may vary, potential ideas include:
         1. Budget limitations: Public funds are limited, and adding new services might stretch resources too thin or require higher taxes.
         2. Implementation challenges: Providing healthcare or housing involves complex systems and may face issues like corruption, inefficiency, or lack of skilled workers.
         3. Crowding out private innovation: If the government controls too much of a service (like housing), it might discourage private developers from offering affordable solutions.
5. Culminating activity: Design a City
   1. Set up: Split the class into groups of three or four students and provide each group with poster paper and makers.
   2. Task: Each group will design a city that includes the five public goods that they think are most important for the residents of the city. Students will draw their cities on their poster paper and label each of the five public goods they have included in their city. For each of the five public goods, the group should include a caption on the poster that briefly describes:
      1. 1. How the good meets the criteria of a public good.
         2. Why that particular public good is important for the residents of the city.
         3. Gallery walk (if time permits or as an Extension): After each group completes their poster, groups may hang up their poster or place the poster on a desk. Then, the class can complete a gallery walk in their original groups, viewing each poster to see which public goods other groups included in their cities.

About the Authors:

Lisa Allen has been a social studies teacher at Deerfield High School in Illinois since 1998. She is an instructional coach who has presented at the Future of Educational Technology, and a member of civic learning organizations including Retro Report, iCivics and the Council on Foreign Relations.

Jack DiMatteo works at Deerfield High School in Illinois, where he recently completed his student teaching. He majored in economics in college and worked for four years as a legislative staffer in the U.S. House of Representatives before transitioning to education. He will be a full-time social studies teacher in Illinois beginning in the 2025-26 school year.

Standards

College, Career, and Civic Life (C3) Framework for Social Studies

• D2.Eco.1.9-12. Analyze how incentives influence choices that may result in policies with a range of costs and benefits for different groups.
• D2.Eco.6.9-12. Generate possible explanations for a government role in markets when market inefficiencies exist.
• D2.Eco.8.9-12. Describe the possible consequences, both intended and unintended, of government policies to improve market outcomes.
• D3.4.9-12. Use evidence to develop claims in response to compelling questions.
• D4.6.9-12. Use disciplinary and interdisciplinary lenses to understand the characteristics and causes of local, regional, and global problems; instances of such problems in multiple contexts; and challenges and opportunities faced by those trying to address these problems.
• D4.2.9-12. Construct explanations using sound reasoning, correct sequence, examples, and details with significant and pertinent information and data.

Common Core Literacy Standards

• CCSS.ELA-LITERACY.RH.11-12.1: Cite specific textual evidence to support analysis of primary and secondary sources, connecting insights gained from specific details to an understanding of the text as a whole.
• CCSS.ELA-LITERACY.RH.11-12.2: Determine the central ideas or information of a primary or secondary source; provide an accurate summary that makes clear the relationships among the key details and ideas.
• CCSS.ELA-LITERACY.RH.11-12.8: Evaluate an author’s premises, claims, and evidence by corroborating or challenging them with other information.
• CCSS.ELA-LITERACY.WHST.11-12.1: Write arguments focused on discipline-specific content.
• CCSS.ELA-LITERACY.WHST.11-12.9: Draw evidence from informational texts to support analysis, reflection, and research.