The distinction between public goods and private goods is that:

The distinction between public goods and private goods hinges on the concepts of excludability and rivalry. Public goods are characterized as non-excludable and non-rival. This means that individuals cannot be effectively excluded from using them, and one person's use of a public good does not diminish the ability of others to use it as well. Classic examples of public goods include clean air and national defense; when one individual benefits from these goods, it does not reduce availability for others.

In contrast, private goods are both excludable and rival. This implies that individuals can be excluded from using them, and one person's consumption of a private good reduces the amount available for others. Common examples of private goods include food items and clothing; when one person eats a sandwich, that sandwich is no longer available for someone else.

Understanding this distinction is crucial for comprehending how goods are classified in economics and how they can be provided within a market system or through government intervention.