Markets may fail to control the abuses of monopoly power
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How are 'Missing markets' a type of Market failure?
.Markets may fail to form, resulting in a failure to meet a need or want, such as the need for public goods, such as defence, street lighting, and highways.
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How are 'Incomplete Markets' a type of Market Failure?
Markets may fail to produce enough merit goods, such as education and healthcare.
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How are 'De-Merit Goods' a type of Market Failure?
Markets may also fail to control the manufacture and sale of goods like cigarettes and alcohol, which have less merit than consumers perceive.
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How are 'Negative Externalitites' a type of Market Failure?
Consumers and producers may fail to take into account the effects of their actions on third-parties, such as car drivers, who may fail to take into account the traffic congestion they create for others.
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How is 'Informational Failure' a type of Market Failure?
Markets may not provide enough information because, during a market transaction, it may not be in the interests of one party to provide full information to the other party.
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How are 'Unstable Markets' a type of Market Failure?
Sometimes markets become highly unstable, and a stable equilibrium may not be established, such as with certain agricultural markets, foreign exchange, and credit markets.
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How is 'inequality' a type of Market Failure?
Markets may also fail to limit the size of the gap between income earners, the so-called income gap.
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Other cards in this set
Card 2
Front
How are 'Missing markets' a type of Market failure?
Back
.Markets may fail to form, resulting in a failure to meet a need or want, such as the need for public goods, such as defence, street lighting, and highways.
Card 3
Front
How are 'Incomplete Markets' a type of Market Failure?
Back
Card 4
Front
How are 'De-Merit Goods' a type of Market Failure?
Back
Card 5
Front
How are 'Negative Externalitites' a type of Market Failure?
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