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A market without marketfailure

free

p S ME
the cost pong
y
one more wit
p
PS
y
the benefit to
D MB
the consumo funny
o Q One more nit
Q

Social suples is maimised where MB MC


S D

There is allocate efficiency When producers supply


lo most
f by
a a
q g
desired consumes

P MC
where 55 is maximised
No deadweight loss

Markt failure
desert goods
merit goods
Monopoly side
externalities
Positive negative
ya
action experienced
y a

publicgo.li by thirdparties

consumption externalities manija


Negative
un
Social
P n cigarettes emperné Lost

1
Fi 1 deadweight los
magia
Port

1
if
1
1
margin
social
y
private
bengt
I
buf
MSB MPB
Kon Q l

overconsumed in market
why are cigs free
addictive properties

don't care about externalities

manare negative cons at


y

Demeritgood a gls
whose consumption is socially
undesirable has negative consumption externalities

and we overconsund in thefree market


policies to correct market failure demeritgoods
y

POLICY EFFECTS ON MARKET EVALUATION

Pricefloor
Pp tu Qd deadweight

Os al suples Pp t CS
tren Y
por mostapertel

Indirect tax IS TP Q T gout reserve

Pigavianta producen TRI


tu anglo fu TU
with negative
extermines Taxis regressive
low Y households
I D pay

restrictions
more as
yY
Regulation age
legislation prohibit consumption
Ita revenues

make ls black markets


y
I consumption compgo.de
illegal y
un
Politically unfavorable
I human rights
Education
IMP B
l ID Iu se
awareness
MSB Ust
campaigns Opp
work PEDI
magnet
Ip tren
addictive
highly

1 Define negativo
consumption ext templas
demeritgods necessities

indirecta

2
s mpc.me
cigarettes
p n explain diagram

fi deadweight
Mattfailure
µ
B MPB
E
µ

3 Education t awareness

Ü
Subsidise substitute publictransport
2 3 work

f
f ey
Psoe trae t Dg Ampre
5 Indirect tax on petrol
Cortot
Pp y petal ID cars Walunte
consumption externalities
trial tome in the
heathen education
following pls
d
Positive healthy
f
positive side effects consumption gls on
y y
3rd parties
education
University
ey
I labor productivity

IU
Crime

n
otitis samsara
f
p

n
P
ta 1

1
1 1 Msr

D MPB
l s
o Q QUIT
Q

Q ont Q the's on under


allocating f UP
in alocative
gls no
giving
whose is
gls
consumption
Merit goods a
desirable has t've cons
socially
but is under provided markt
ext by
POLICY FRUIT ON MARKET EVALUATION

ISubsidise P n
Ip TQ Y
SMEE
gls TEE Poor
bergara
L indirect Ip j Pasta
ya
tan tryout budget
y pipi
o Q Qart
Q
SI QI to Kon Pt

Education t I willingness to wnsue y.opp.UA Cepasivo


awareness Impo TD Had tinge
Consumer habits

May be more
with kids
effective

Legislativa Pdenadfrgls
regulation MPB
t disposable Y forth
16
J
y lay los
humor
right
ojeda
freedom
y
comply vaccines
1Mpts mt always effective
Nudge
used
Techniques

to change consumer

behaviour without

reducing their
options
Opp cost

government y s MPL low quality provision

provisor
y gls
Ps Ip
Y competition
Positive predation externalities

The positive side


jet y
the pad
y
a
gls on

third pitias
Airport construction infrastructure
ey
Flutie cars
Rt D focused firms

ayy fins
Green

r S MPC
p
MSC
f positin
P to plat

JI III I
www.t.s

t D MPB MSB
1 1
Di Kopp
Q

Hop a
welfarelos PI B
due to x
Markt failure visto

alicatininefficiny MSC Msp


in free market
aleathcaling f
i p n part gls
Policies to correct market
faire

POLICY EFFECT ON MARKET EVALUATION

ideally to
MSC
P subsidies d MPC gut
revenue me baya
india tan for other arcos
Trulyy
IP TQ envy
Lp

Government
provision Is CMPC xopp.cat parisina
y gls investmenty
IP TQ
be tw
Quality
y gli my

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