Answer to Question #205164 in Microeconomics for nikita deswal

Question

NHS figures show that a declining number of children are receiving all their routine vaccinations, including meningitis and the combined measles, mumps and rubella (MMR) vaccine. In some cases, vaccination rates of children are as low as 90%. Evaluate the significance of information failure in decisions made about the consumption of merit goods. [25]. IST PARA defination the two to three points with evaluation and a judgement

Answer 1

Merit goods refer to goods and services which government feels that the public will under-consume and should be subsidized to increase consumption. Poor decision-making takes into account short-run costs and ignores long-run benefits which make it worth evaluating the significance of information failure in decisions made about the consumption of merit goods. Merit goods have a positive externality that is not realized by people at the time of consumption as the benefits are usually recognized in the future. This is because there is significant information failure in terms of expected benefits from consumption of, the merits goods among consumers. therefore, to achieve a total socially efficient level of consumption of merit goods, consumers should be enlightened on the benefits of it. they should be fully equipped with the information on the net private benefit of consumption 0f the merit good.