CHAPTER 21 GOVERMENT FAILURE Flashcards
1
Q
Government failure
A
Occurs when a government intervention leads to a new welfare loss compared to the free market solution
2
Q
Public Choice theory
A
Theories about how and why public spending and taxation are made
3
Q
Rent-seeking
A
The use of political power by an economic agent to manipulate the distribution of resources for their own benefit at the expense of others without creating an extra wealth for society
