Government Failure (AQA A-Level Economics): Flashcards
📚Flashcards
Practise the cards
10 cards from this deck
ShowHide
Practise the cards
10 cards from this deck
Define government failure
Define government failure
Govt intervention reducing welfare vs free-market outcome
3 main causes of govt failure
3 main causes of govt failure
Conflicting objectives, admin costs, unintended consequences
Short-termism in govt policy
Short-termism in govt policy
Favouring short-term gains over long-term benefits
When do admin costs = govt failure?
When do admin costs = govt failure?
When costs are high relative to benefits achieved
Law of unintended consequences meaning
Law of unintended consequences meaning
Govt intervention unleashes unforeseen/harmful effects
Effect of price ceiling/maximum price
Effect of price ceiling/maximum price
Creates excess demand and black markets
When was UK landfill tax imposed?
When was UK landfill tax imposed?
1996
Unintended result of landfill tax
Unintended result of landfill tax
Significant increase in illegal fly-tipping
Annual cost of fly-tipping to UK taxpayers
Annual cost of fly-tipping to UK taxpayers
Over 392 million USD per year
PED for landfill space (2018-2022)
PED for landfill space (2018-2022)
(inelastic demand)