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Identify a market failure that plays an important role in a movie, novel, short story, TV show, or song
Identify a market failure that plays an important role in a movie, novel, short story, TV show, or song. Explain what the market failure is how it is present in the source.
For example, one of my favourite movies is "Open Range," a western starring Kevin Costner. The movie's title refers to land that was considered common property where anyone was free to graze their cattle. Kevin and his crew are grazing their cattle in an open range, but the local cattle barn doesn't like it, fearing there won't be enough grass left for his cattle and uses violence to encourage them to leave. The market failure on this plot is "Tragedy of the Commons: when a resource is commonly owned or if no one owns the resource individually, each person has an incentive to use the resource as much as possible, leading to overuse and perhaps depletion - in this case the common pasture.
Expert Solution
There are many movies, novels and shows which explore market failure situations. A popular film from 2000, based on a true story, is Erin Brockovich. In the film, people are getting sick from exposure to pollution from a California power company. The firm is imposing a cost on local people via the pollution, but not properly paying for their illnesses or to produce cleaner energy. Erin Brockovich gathers evidence of the harm, what economists call the marginal social cost, and her boss, a lawyer, uses the US legal system to try to solve the market failure through restitution payments.
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