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What sort of market failure exists in the market

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Reference no: EM132018484

Assignment: Pick one market in which the price system does not produce an equitable price and quantity of output. In this market demonstrate which mode of market failure exists. Write a paper of 500 words minimum discussion with at least (2) sources cited in the MLA format. In your discussion be sure to address the following:

1. Describe what sort of market failure exists in the market you chose.

2. Describe an action has our government taken in order to provide this good or service in an equitable fashion in order to resolve this market failure?

3. What has been the end result of this government intervention? (be sure to cite these results. Do not offer opinions)

4. What is at least one alternative to the current government intervention to resolve the market failure?

The following are some ideas to help you identify the type of market failure you're your research paper assignment. Consult with your instructor if you are having trouble picking a topic.

• Public Goods and Services: Is the market/good or service a public good. Some that fit the description are Schools, Highways and Streets, Fire and Police Protection, National Defense, Prisons.

• Lack of Competition: Is the market less than purely competitive? Is it monopolistically competitive, oligopoly or monopoly. A non exhaustive lists of industries that fall into this category are Utilities, Airlines, Banks, Communications providers, and the automotive industry.

• Externalities: Are there in particular, external costs (supply side factors) present in an industry where not all of the cost to society is reflected in the industry/market. (A carefully researched topic can probably reveal an external cost in virtually any industry/market - though some more than others)

Reference no: EM132018484

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