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Market failure and how it can be remedied or minimized

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Find a current news article (within the last 6 months) that addresses a 'market failure' and write a summary covering the following points:

a. Explain the nature of the failure (it may be a failure to adequately provide a public good, or a failure to distribute income fairly, or a failure to account for an externality such as pollution.)

b. Recommend how this failure could be remedied or at least minimized.

c. Explain the risks inherent in having the government step in to compensate for market failure.

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Solution Summary

This solution features a current news article that addresses a 'market failure'. The solution explains the nature of the failure gives recommendations on how it will be remedied or at least minimized. It discusses also the risks inherent in having the government step in to compensate for market failure.

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Article: Consumptionomics: Asia's Role in Reshaping Capitalism and Saving the Planet

Author: Chandran Nair

Summary
Nair believed that the UN is reduced to 'toothless talking' and has no definitive solution to a market failure issue called climate change. The author argues that relying on capitalism to solve ecological problems is like relying on the fox to keep the chickens safe. Climate change is an example of massive market failure, so the world can't rely on markets to fix it.

Nair contends that Asia cannot follow the same consumer capitalism development model the West has. There are simply too many people in Asia, and not enough resources on the planet, to transplant America's steak and SUV lifestyle there. Asia has to do things differently.

"In Asia it can only deliver short-term wealth to a minority; in the long term, it can only deliver misery to all."

Nair has an alternative to winning public support for actions to save the planet: authoritarianism. His models for good government are China and Singapore.
Moreover, the idea that Asian values provide an alternative to environmental degradation requires a highly selective interpretation of region's current state of environmental affairs. Nair says that Japan's maintenance of traditional values has encouraged wilderness conservation and, aided by ...

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