Geothermal Systems Engineering
Market failure occurs when the allocation of goods and services by a free market is not efficient, leading to a net social welfare loss. This situation often arises due to various factors like externalities, public goods, and information asymmetry, which prevent the market from reaching optimal outcomes. In the context of renewable energy, market failures can hinder investment and development, necessitating the use of incentives to encourage sustainable practices and technologies.
congrats on reading the definition of market failure. now let's actually learn it.