Government Failure

Government failure occurs when government interventions intended to improve economic or social conditions lead to unintended negative outcomes. This can happen due to inefficiency, lack of information, mismanagement, or conflicting objectives. For example, a policy aimed at reducing unemployment might inadvertently create a dependency on welfare, discouraging job-seeking. Unlike market failures, which are natural issues in free markets, government failures arise from the actions or decisions of the government itself, leading to wasted resources and less effective solutions to problems they sought to address.