Consumer Welfare Theory

Consumer Welfare Theory focuses on understanding how economic policies and market conditions affect consumers' well-being. It suggests that a well-functioning market benefits consumers by providing more choices, better prices, and higher quality products. When markets are competitive and efficient, consumers gain from increased satisfaction and utility. Policy decisions are often evaluated based on their ability to improve consumer welfare, ensuring that consumers get fair prices and access to goods and services without unnecessary restrictions. Overall, the theory aims to promote conditions that enhance consumers' ability to make satisfying choices in the marketplace.