- Created by: Sin Heng
- Created on: 21-11-19 12:55
What are the 2 ways which result from market failure?
Partial market failure and missing market
Define 'partial market failure'
When a market for a good exists but there is an over- or underproduction of the good
Define 'missing market'
A market where the market mechanism fails to supply any of a good
Define 'complete market failure'
When a market fails to supply any of a demanded good, therefore creating a missing market
How do public goods (defence, street lighting) become under-provisioned?
Individuals have a large incentive to not pay for…