GOVERNMENT FAILURE
When markets fail, government action is often required to help the market function more effectively. However, government failure occurs when “government actions, while at first seeming desirable, produce results that are not better, and potentially worse, than the results produced by apparently failing markets.”[3] This is because government interventions can themselves create problems. Hence, the concept of government failure in policy analysis has two main purposes. To remind us that government interventions are never “costless” and to highlight problems that government action itself can introduce into any given context.[4]