market failure
Pronunciation
Noun
B2 Upper-intermediate
Quick answer
A situation in which a free market fails to distribute goods or resources efficiently on its own, often requiring some form of intervention.
Test yourself
Which word fits the gap? "Pollution is a classic example of _____, since the cost isn't paid by the company that causes it."
Answer: market failure
In your own words, what does "market failure" mean?
A situation in which a free market fails to distribute goods or resources efficiently on its own, often requiring some form of intervention.
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