What are market failures and transaction costs?

Market failure in economics is considered to be a situation wherein the allocation of services and goods are not effective. There exists another result that is conceivable wherein at least 1 person could be better-off without tending to make the other person worse-off. Transaction costs are considered to be the incurred expenses while selling or buying a service or good. Transaction costs in a financial sense are inclusive of the spreads and commissions of the broker', which are the distinctions between the price paid by the buyer the price paid by the dealer for a security.