Market Failures and Economic Regulation
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Abstract
A country’s economic dream is to build ideal markets where suppliers and demanders honestly and efficiently meet their needs with fair and balanced prices. However, in reality, these types of markets are almost nil, since, with the existence of Information asymmetries, the perspective changes and from ideal markets, it changes to markets with failures, since when there are gaps in data, figures, and others, the participants in these markets do not synchronize with their parts. Consequently, there is no perfection in their transactions, and therefore, their activity and performance would not reach the most convenient standards in the commercialization of their goods or services since their decisions will not be the most optimal. With market failures, the State, through its control bodies, creates market rules and applies regulatory norms to appeal to any type of failure committed in the market.
JEL CODE: K, K0