Globalisation Glossary: Difference between revisions

The generation of (negative) externalities is also termed ‘market failure’, as it largely requires an intervention by the state or other collective action. On a similar line, however, political science uses the term ‘state failure’, because many collective or state actions may have implications much worse (higher costs) than the problem causing the action (the benefits) to be taken. Emphasis on either type of failure is usually based on one’s political (ideological) persuasion. Whereas right-wing governments tend to emphasise state failure and efficiency of free market competition, governments left of the centre typically point out market failures and the need for public control and regulation.

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