Answer to Question #236093 in Microeconomics for KAT

Question #236093

Describe the theory of second best?


1
Expert's answer
2021-09-13T18:51:48-0400

The theory of the second best says that in a situation where two or more markets are not perfectly competitive, then efforts to correct only one of the distortions may make the economy to drive further away from Pareto efficiency.


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