Government intervention through direct command-and-control regulation of industrial emissions is often problematic because it
encourages firms to respond to market-driven price signals
can lead to unintended consequences, such as illegal dumping or evasion
resolves asymmetric information between manufacturers and consumers
reduces the administrative burden and monitoring costs for the regulatory authority
9 exam-style questions on Edexcel A A Level Economics 1.4.2 Government failure. Each one has a worked solution and a mark scheme showing where the marks go.