Disadvantages Of Market Failure

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Market failure is a situation that occurs when resources are not allocated effectively or efficiently. In my opinion, market failure means that market allocation is not satisfied everyone’s interest. And it will exist forever.
For example, it appears monopolistic conduct in the market which decreases the role of competition. And company which produce common product lost market so that lost interest. This behavior is not reasonable allocate resources and satisfy other companies’ interest. It is market failure.
Market failure have four conditions, includes:
The first case is merit goods. Merit goods means that goods take benefit. There are two characteristics. First, customers can’t understand perfectly the private benefits of the product. Second,
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Around half of all ocean pollution is caused by sewage and waste water. Each year, the world generates perhaps 5–10 billion tons of industrial waste, much of which is pumped untreated into rivers, oceans, and other waterways.
In the 19 century, although government adopted some measures about water pollution, government didn’t really attach importance to this problem so that water pollution is more and more serious. But with the development of the times, the UK government constantly perfecting the policy system that setting up relevant department and organization and takes more detailed laws and regulations, such as, “Water Policy White Paper”. So it also strengthens the human consciousness of protecting the environment.
It may be causes economic fluctuation which the UK government makes policy about water pollution, such as, government raise taxes; it could lead to rising prices. But the policy will take more advantages, such as, it will add more industries about water and solve unemployment problem that it make economic growth
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