A Report On The Market Failure

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 Market failure:A condition in which a market does not effecintly allocate resources to achieve the greatest possible consumer satisfaction. As a result of market failure, government intervene in the economy. (John O. Ledyard ,2008) Eg: Because of the price of apple was increased last year, this year many people to plant the apple tree,and the number of apple sharply increased. So the supply exceeds demand, and the price sharply decreased. Government: An important function of government is to communicate its Macro economic objectives. A principal communication tool used to communicate the economic intentions of the government is budget. (Aidan R. Vining, 2004)
Merit goods
A merit goods often has positive externalities associated with it. …show more content…

Eg: The State Grid Corporation China is belong to the imperfect competition. The State Grid Corporation China almost monopoly the whole power transmission of China. The government is likely to intervene when one firm has a large degree of market power. They monopoly the market for infrastructuren and the national safety. In economics the team market concentration is used to describe the degree of monopoly.
An externality refers to the uncompensated impact of one person’s actions on the well-being of a bystander. That would lead to the resources allocation poor efficiency. (George,2000) Eg: When the factory began to production,and that will make the environment pollution. The government use their power to adjust, and coordinate the problems in social. The government should realize and protect the basic interests to ensure the social equity.
 Environment
The environmental pollution problem is a negative externalities, and need the government to take part in it. But the government policy failure and environment failure would lead to a heavy environmental pollution problems. (McCormick, John,2001) And the environmental pollution is a main problems in social, the government should to keep the environment is clean, that could make the economic development. Air pollution is the introduction of particulates, biological

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