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Should government intervene in a market? (Reasons why it might be…
Should government intervene in a market?
Reasons why it might be justified.
Economic Growth
Macroeconomic Stability
Efficiency
There is a lack of efficiency if there is market failure. Define both of these terms. Why might this be the case?
Imperfect Competition
Externalities
But you might be able to address this with subsidies instead
The item is a public good
Information Imperfection
But could private organisations provide this?
Equity
Paternalism
you can mention 'merit goods' and how people won't make the best decisions
Reasons why it might not be justified
Ineffectiveness of Government Policy
Dangers of intervention
Large Government Budget Cost
If you have time, relate this to empirical results comparing gov. intervention to private provision in the market.