Introduction to Government failures Essay Example | Topics and Well Written Essays - 750 words

Introduction to Government visitations - Essay framework Information failure is also another major factor that greatly contributes to governments failures. Because the government does not inescapably know enough details to enable it to make effective decisions on the best way to divvy up scarce resources. Most of the economists believe in the efficient mart hypothesis. That is, they assume that the market will everlastingly contain adequate information than any government or individual.The insinuation is that market values and market movements should be free from interference because individuals or governments cannot improve upon markets. Moreover, taxes on goods as well as operate can raise prices artificially and interfere the efficient operation of the market. Also, taxes on incomes can create a disincentive impact and discouraging individuals from working hard to achieve the set goals and objectives in a token country.Fixing of prices is also another major factor that lead s to government failures. The government can fix both tokenish as well as maximum prices that can create distortions that contribute to various shortages. Shortages may snarf if the government of a particular country fixes the prices of various products below the market rate. Also, provision of free health care services by the government is another major factor that contributes to its failures. That is, there will be long waiting lists for treatment that might be outnumbering the efforts of health care providers and thus causing failure in the provision of this particular service.