It prevents the price mechanism from functioning because consumers can benefit without paying, resulting in the free-rider problem and a missing market.

It means the marginal cost of providing the good to an additional consumer is zero ($MC=0$), making any positive price allocatively inefficient.

It causes asymmetric information where sellers possess more information than buyers, leading to adverse selection and market collapse.

It results in a negative externality in consumption where the marginal social benefit ($MSB$) is less than the marginal private benefit ($MPB$).