What term describes harmful goods that are often restricted or taxed?

The term that describes harmful goods which are often subject to restrictions or taxes is demerit goods. Demerit goods are products that are considered to have negative effects on individuals and society, typically leading to overconsumption. Because these goods can cause harm—such as health issues related to smoking or alcohol consumption—governments often intervene by imposing taxes, regulations, or restrictions to discourage their consumption. This intervention aims to reduce the negative externalities associated with their use and promote overall public health and welfare.

In contrast, public goods are non-excludable and non-rivalrous resources that are available to all, while merit goods are those considered beneficial, and governments often promote their consumption. Common goods refer to resources that are available to everyone but can be depleted, leading to potential overuse. Understanding these classifications allows for better comprehension of how governments respond to different types of goods and their societal impacts.