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1.8 The market mechanism, market failure and government intervention in markets

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Question 25

Extract C: The financial challenges facing local community radio and regional audio broadcasting

When local civic news and cultural programming are broadcast over free-to-air analogue or digital radio (DAB), they possess some of the classic properties of a public good. However, while some community radio stations provide their digital podcasts and online streams entirely free to the public, others are struggling to maintain this open-access model. Some regional networks have begun restricting archive access to paying subscribers or relies heavily on listener membership programs to survive, as corporate advertising revenue shifts toward global social media conglomerates.

These different financial models reflect a period of transition as stations try to cover their high fixed operating costs while traditional listener numbers decline.

Some civic groups argue that, because local radio stations are such a critical source of local democratic information, educational content, and emergency announcements, the government should intervene with financial support to ensure their survival. Others argue that subsidies distort the media market and represent an inefficient use of taxpayers' money.

'Some civic groups argue that, because local radio stations are such a critical source of local democratic information, educational content, and emergency announcements, the government should intervene...' (Extract C).

Using the data and your economic knowledge, evaluate the case for and against the government subsidising local community radio and regional digital audio platforms.

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Markscheme

1.8 The market mechanism, market failure and government intervention in markets Questions

  1. A Level
  2. /Economics
  3. /1.8 The market mechanism, market failure and government intervention in markets

378 exam-style questions on AQA A Level Economics 1.8 The market mechanism, market failure and government intervention in markets, covering 1.8.1 How markets and prices allocate resources, 1.8.2 The meaning of market failure, 1.8.3 Public goods, private goods and quasi-public goods, 1.8.4 Positive and negative externalities in consumption and production, 1.8.5 Merit and demerit goods, 1.8.6 Market imperfections, 1.8.7 Competition policy (A-level only), 1.8.8 Public ownership, privatisation, regulation and deregulation of markets (A-level only), 1.8.9 Government intervention in markets, and 1.8.10 Government failure. Each one has a worked solution and a mark scheme showing where the marks go.

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