This is a short revision video covering merit goods and market failure. Merit goods are goods and services the government feels that people will under-consume, and which might be subsidised or provided free at the point of use. Both the state and the private sector provide merit goods. With merit goods individuals may not act in their own interest because of imperfect information – i.e. they do not fully understand the private benefits of their consumption. Information failure is an important aspect of the merit goods issue.
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