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Market failure - Wikipedia

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In neoclassical economics, market failure is a situation in which the allocation of goods and services by a free market is not Pareto efficient, often leading to a net loss of economic value.[1] Market failures can be viewed as scenarios where individuals' pursuit of pure self-interest leads to results that are not efficient – that can be improved upon from the societal point of view.[2][3] The first known use of the term by economists was in 1958,[4] but the concept has been traced back to the Victorian philosopher Henry Sidgwick.[5] Market failures are often associated with public goods,[6] time-inconsistent preferences,[7] information asymmetries,[8] non-competitive markets, principal–agent problems, or externalities.[9] The existence of a market failure is often the reason that self-regulatory organizations, governments or supra-national institutions intervene in a particular market.[10][11] Economists, especially microeconomists, are often concerned with the causes of market failu

Market failure - Wikipedia Jump to content From Wikipedia, the free encyclopedia Inefficiently allocated markets While factories and refineries provide jobs and wages, they are also an example of a market failure, as they impose negative externalities on the surrounding region via their airborne pollutants . In neoclassical economics , market failure is a situation in which the allocation of goods and services by a free market is not Pareto efficient , often leading to a net loss of economic value . [ 1 ] [ 2 ] [ 3 ] The first known use of the term by economists was in 1958, [ 4 ] but the conc

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