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infoWhy this? Market failure explains why decisions that benefit individual consumers or producers may not allocate resources efficiently for society. Externalities and other causes of failure allow us to assess the case for government intervention, while government failure highlights the costs, limitations, and unintended consequences of policy.

scheduleWhy now? Demand, supply, and the price mechanism provide the benchmark needed to investigate when market allocation falls short. Alongside our understanding of private costs and profits, this enables us to distinguish business outcomes from wider social effects and prepares us for more detailed evaluation of market failure and regulation in Year 13.