market failure
/ˈmɑːrkɪt ˈfɛɪl.jər/ · mar·ket fail·ure
noun
- A situation in which the free market fails to allocate resources efficiently, leading to a lack of supply or an excess of demand. The economist argued that the housing market failure was a result of government policies.
- A failure of a market mechanism to achieve its intended goal, often due to external factors such as government intervention or information asymmetry. The market failure in the agricultural sector led to food shortages and price increases.
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Did you know? The concept of market failure has been widely used in economic policy-making, influencing the development of regulatory frameworks and market interventions.
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