Market failure has a precise economic meaning focused on efficiency: a situation where resources could be reallocated to make at least one person better off without making anyone worse off (Pareto optimality), as opposed to the colloquial sense of markets simply not delivering what someone wanted.

definitionpending

Speaker

Clifford Winston

Evidence Quote

economists have a very precise notion of what market failure is and it does focus on what we call efficiency issues

Source

Clifford Winston on Market Failure and Government Failure 12/28/2009EconTalk
Created: 6/15/2026, 9:37:54 AM

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