Market
Economy Failure Instances
Here is an instance where Market Economy fails:
A product that is
- Expensive to produce with current technologies
- Very low in demand
- Little incentive for the Market to produce the product, but if Market fails to produce the product in adequate quantities then we would have devastating consequences
Low in demand and expensive to produce, which means - very little incentive for Market to produce the product.
Now, Market doesn't have the incentive to produce, but if Market fails to produce the product in adequate quantities then we would have devastating consequences.
Example:
- Some drugs in US Market; as an example - Aquasol A.
- Low in demand and expensive to produce - which translates into very low incentive for Pharmaceutical Companies to produce those drugs. But if Market fails to produce those drugs in adequate quantities then, we would have devastating consequences in our Healthcare system.
Another Instance of Market failure
Bill Gates in a 2009 TED talk jokingly pointed out:
Baldness is a problem - no doubt about that. It makes us look ugly.
But malaria, is a much more serious problem.
In 2012 alone, there were 207 million cases of malaria. That year, the disease is estimated to have killed between 473,000 and 789,000 people. [2]
Now you know what - more dollars are spent on baldness research than on Malaria! (A terrible joke.)
Because that's what the Market demands.
Rich "bald" people invest their money on baldness research.
But the rich are not willing to spend their money on Malaria research.
And the place where this disease is most widespread, Africa, is the poorest region on earth, where the Governments do not have adequate resources to spend money on Malaria research.
So here - we have another instance of Market (as we know it today) Failure.
References
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