Submitted by nauman16 on July 14, 2007

• Category: Business
• Words: 251
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Economy

Barnett Prize Matthew Bradfield

There are some economists who would claim that smoking is a perfect
example of market failure. The definition of market failure is very
simple; it is when the market mechanism fails to allocate resources
efficiently in one or more of the following four fronts: Social
Efficiency; Allocative Efficiency; Technical Efficiency; Productive
Efficiency.

Smoking is an example of market failure because it fails to allocate
resources in a socially efficient way. When someone buys a pack of
cigarettes they do not take into consideration the effects of other
people?s health...

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