<2.8 MARKET FAILURE (I): CPRs & EXTERNALITIES>

--WHAT IS MARKET FAILURE?--

A MARKET FAILURE occurs when the final 'Free Market Quantity Transacted' (QFM) achieved by the market mechanism DEVIATES FROM THE SOCIALLY OPTIMAL QUANTITY 'Qso' (where MSC = MSB = the allocatively efficient level) and a deadweight loss is created.

--TYPES--

--2.8.1 COMMON POOL RESOURCES--

--2.8.2 EXTERNALITIES--

--2.9 LACK OF PUBLIC GOODS--

--2.10 ASYMMETRIC INFORMATION--

--MARKET POWER--

--INABILITY TO ACHIEVE EQUITY--

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