Merit good

A merit good is a good that is underconsumed because individuals typically consider how the good benefits them as individuals rather than the benefits that consumption generates for others in society. In economic terms, this is because the positive externalities of the good are not internalized by consumers. To increase efficiency, the state may choose to encourage greater production or consumption of a merit good through subsidies or to produce the good itself. Goods typically considered to be merit goods include education and preventative health care.