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Market failure is the condition where the allocation of goods and services by a free market is not efficient. Market failure can be viewed as a scenario in which individuals' pursuit of self-interest leads to bad results for society as a whole.[1] The first known use of the term by economists was in 1958,[2] but the concept has been traced back to the Victorian philosopher Henry Sidgwick.[3] The belief that markets can have inefficient outcomes is a common mainstream justification for government intervention in free markets.[4] Economists, especially microeconomists, use many different models and theorems to analyze the causes of market failure, and possible means to correct such a failure when it occurs.[5] Such analysis plays an important role in many types of public policy decisions and studies. However, not all economists believe that market failures occur, or that they provide compelling arguments for government intervention, because some types of government policy interventions, such as taxes or subsidies, may lead to an inefficient allocation of resources, which has been called government failure.[6] In mainstream analysis, a market failure (relative to Pareto efficiency) can occur for three main reasons.[1] More fundamentally, the underlying cause of market failure is often a problem of property rights. As Hugh Gravelle and Ray Rees put it,
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