ECON-2086EL Chapter Notes - Chapter 7: World Health Organization, Externality
22 Nov 2017
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Chapter 7 part ii- market failure: the. The great depression that occurred in 1929 was caused by banks making risky moves and failing. This caused the banks to fail using the hard-earned money of the general population. The government implemented the banking act in 1933 that required banks to avoid risky investments (usa). However, the glass-steagall act was overturned in 1999 due to heavy lobbying. The new glba act allowed banks to engage in risky activities that had previously been barred. This led to the collapse of the banks again in 2008-2009 when they bet heavily on the us housing market. Negative externalities occur when the third party (neither the producer or consumer) is heavily affected by the production of a good or service. Cancer has been on the rise in modern world. Organization states that 80% of cancer cases are caused by the environment.
