Government Intervention in Markets

Government intervention in markets involves actions taken by the government to influence economic activity, aiming to correct market failures, promote fairness, and ensure stability. This can include policies like setting prices (price controls), providing subsidies or taxes, regulating industries, or implementing policies to protect consumers and the environment. Such interventions help prevent monopolies, reduce inequality, and ensure essential goods and services are available and affordable. While the goal is to improve market outcomes, interventions must be carefully designed to avoid unintended consequences like inefficiency or market distortion.