Market Failures

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Discussion: Market failure in your policy issue

Policy Issue: Does providing specialized programs improve inmate rehabilitation efforts and reduce the rate of recidivism?

Policy Area: Rehabilitation and Recidivism

Crane (2006) Public Finance Concepts for Planners; Read the section on market failures (p. 9-18 Begins with “The Public Purpose of Plannning” is attached below)

Crane discusses market failures in the context of local government and specifically in the field of land use planning, but the concepts are applicable much more broadly. As you read, consider if market failures such as nonrivalry, nonexclusivity, externalities, or equity are a part of your policy problem.

Having read Crane’s description of market failures, consider your policy issue. To what extent does each form of market failure exist (nonrivalry, nonexclusivity, externalities, or equity) or not within your policy area? In order to make an effective claim that market failure is not involved, then you will need to describe the functioning of the market related to your issue.

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