Market failure intro

• Market failure


  A misallocation of scarce resources by private sector firms
• Complete market failure


  Occurs when there is a missing market
• Missing market


  The market that does not supply products at all despite the society demanding them
• Partial market failure


  Occurs when the market still exists but does not provide the optimum amount of goods and services

  • There is an overconsumption/production or underproduction/consumption
• Types of market failure

  1. Public goods
  2. Merit goods
  3. Demerit goods
  4. Externalities
  5. Poverty and inequality
  6. Information failure
  7. Factors of immobility