Merit goods refer to any good in economy that is needed, yet not demanded in sufficient amounts. A common example of a merit good is insurance. People do have a demand to mitigate risk, but they do not, intrinsically, demand insurance. Merit goods are a controversial topic, because who decides what is needed. They become even more subjective when politics are mixed into the equation. Many governments has forced policies involving what they deem to be merit goods. One of my personal favorites can be traced back to King Henry the VIII, and the founding of the Anglican Church. The “Book of Common Prayer” was deem essential and necessary by Henry the VIII. It became required to own, and is there for a merit good. A more modern link to merit goods is unfolding in the United States. The issue of health insurance has sparked a new debate on the validity of merit goods, and what they are exactly. Merit goods are quite unique because they still effect macroeconomic indicators like price levels, inflation, and production measures. Due to these wide reaching effects, every good that could possibly be deemed a merit good is heavily scrutinized. A lot of merit goods are paid for through taxes; we see nations that provide more merit goods having higher tax rates. This is common in European Nations. The current discussion in the United States over the acceptance of healthcare goes to the root of the issue with merit good status. Consumers value freedom of choice highly, and feel the exchange for their freedom of choice is not being properly compensated. Whether it is or not, this remains the best contemporary example of how merit goods react with the economy in which they exist.