Question

Why do governments fail

Answer 1

Government failure may arise because of unanticipated consequences of a government intervention, or because an inefficient outcome is more politically feasible than a Pareto improvement to it. Government failure can be on both the demand side and the supply side.

Answer 2

Government failure occurs when a ruler forces people to do things that the people are otherwise unwilling to do and the result is inefficient and ineffective. Causes of government failure include Economic Calculation Problem: The more government is involved, the more actual costs and actual demand is hidden.

Step-by-step explanation: