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Underprovision in Free Markets by Mohd Afwan is a document available to read on EtoBox.
What is Underprovision in Free Markets about?
The free market may fail to produce certain goods at a socially optimal level due to externalities or natural monopolies. When production or consumption of a good creates spillover costs or benefits for a third party, the free market will not account for these externalities, resulting in an inefficient allocation of resources. Some goods are also non-rivalrous and non-excludable, meaning the free market does not provide them, leading to underprovision. For goods where a single firm can dominate production,
- Author
- Mohd Afwan
- Language
- EN