wireman Posted August 12, 2012 Report Share Posted August 12, 2012 I'm doing an Extended Essay on the economics of maid-servants and was wondering if the market for female domestic maid-servants was an example of a market failure. There is one prominent characteristic about this market. The government has set a minimum wage and has also legislated that there is a fixed amount of hours a worker can work. However, this is not being followed. Most domestic workers dont know about this. Which is leading to the misallocation of the service. Can this be considered as a market failure?Thank you. Reply Link to post Share on other sites More sharing options...
xXRainbowDashXx Posted August 12, 2012 Report Share Posted August 12, 2012 It could perhaps be counted as an externality if you find a 3rd party that it effects Reply Link to post Share on other sites More sharing options...
wireman Posted August 12, 2012 Author Report Share Posted August 12, 2012 Externalities are just one type of market failure. I was wondering if anyone could tell me if the above scenario could be counted as market failure because one of the determinants is "lack of information" Reply Link to post Share on other sites More sharing options...
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