The methods used to correct market failure include: • Indirect Taxation • Subsidies • Government expenditure / state provision • Buffer stock control • Price controls • Legislation and regulation • Information provision • Competition policy • Public - private partnerships •
Tradeable pollution permits These methods are used to correct the following types of market failure: • Negative consumption externalities • Positive consumption externalities • Negative production externalities • Positive production externalities • Merit
goods • Demerit
goods • Public
goods • Information failure • Inequity