Market Failures

This chapter discusses the question “What is a market such that it can fail?” First, it is not a given that a market can fail. For a market failure to be identified, relatively well-established criteria of success – and failure – of the market need to be established. Market failure thus implies some rendering of a market and how it operates. Further, it is not a given how markets are rendered, nor what is rendered a failure and how to address it. Sometimes a market may be rendered a failure with a view to social life; sometimes market failures are rendered as part of rendering the market in terms “more or less idealized”; and sometimes the failures dealt with are failures of the operation of a particular market, designed with a view to specified purposes or concerns. In sum the chapter argues that market failures – addressing them, repairing and correcting them – have contributed significantly to remarkable changes in markets and their place in social life today, not least as found in the design of markets to serve as a policy instrument – so-called markets for collective concerns.