Pharma and Biotech Industry Management
Market failure occurs when the allocation of goods and services by a free market is not efficient, often leading to a net loss in social welfare. This situation arises when there are externalities, public goods, or information asymmetries that prevent the market from functioning optimally. Understanding market failure is crucial as it impacts innovation and the development of products in various sectors, particularly in healthcare where reimbursement policies can significantly influence research and development efforts.
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