In a market affected by information asymmetry, how does consumer behavior typically influence the provision of public goods?

In a market with information asymmetry, consumers often lack full knowledge about the quality or quantity of public goods, which can lead to poor decision-making. When consumers are unsure about the benefits of a public good, like clean air or public parks, they may underappreciate its value and therefore not support its funding or provision. This can result in less investment in these goods, as people might think they can rely on others to contribute while they enjoy the benefits for free. For example, if a community is debating whether to create a new park but residents are not aware of its potential benefits for health and social interaction, they might vote against it. As a result, the lack of information can lead to under-provision of essential public goods, affecting everyone’s well-being.