Information failure
What Information failure means in Economics A-Level, as defined for AQA.
Definitions of Information failure
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Reference: AQA
A situation where consumers lack accurate information, causing the perceived marginal private benefit to diverge from the actual benefit and misallocating resources.
The mechanism causing underconsumption or overconsumption, distinct from the value judgement that this failure warrants classifying the good as merit or demerit.
A situation where consumers misjudge the personal costs or benefits of a product, often regarding long-term personal costs or benefits.
Topics that use Information failure
- Merit and demerit goods (AQA A-Level)
Related terms
- Demerit goods
- Externalities
- Government intervention
- Imperfect information
- Merit and demerit goods
- Merit goods
- Normative economics
- Value judgement
Using Information failure in the exam
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