Discussion:
DQ1 - Types of Market Failure
As discussed in Chapter 21 of Colander's textbook, externalities are one of three types of market failure. What is the general definition of a market failure and what are the other two types of market failure?
Air pollution is the textbook example of a negative externality with higher education often cited as an example of a positive externality. Please provide one example each of the other two types of market failure cited by Colander. Why would these examples be considered market failure?
DQ 1
What are the effects of innovation and technology on the cost of production? How does technology affect market structure and real-world competition? Which market structure is best suited for technological innovation? Explain your answer. How have technological innovations affected your organization?
DQ 2
Identify an example in which the competitive environment affected the relationship between labor and management. How was the relationship affected? What was the effect on the wages earned by the labor force, and the size of the labor force? What factors at work led to this outcome?