Government failure Flashcards
1
Q
What are the four types of government failure?
A
distortion of price mechanism (max/min p schemes)
unintended consequences
information gaps
administration costs
2
Q
Define government failure
A
when the government intervenes to correct market failure but makes the allocation of resources even worse than before
3
Q
How are admin costs a type of government failure?
A
costs exceed benefits
opportunity cost
