Market Failure and Government Intervention
cost benefit analysis and economic impact analysis are studies that may be undertaken to support different sides of the argument for intervention
Table 17-10 Grand Summary of Market Failure, Government Intervention, Government Failure
NOTE: Government failure should be less than the market failure that government intervention is designed to correct.
To ensure that the government adopts policies which are not unnecessarily severe, managers must work closely with government.
SECTION 8. THE MANAGER'S ROLE
A manager must balance the different problem solving talents of the staff to find an optimal solution to any problems facing an organization. Because employees have been trained to solve different kinds of problems they will have very different points of view about how to solve any given problem a firm may confront. In fact a problem may simply be the trip wire to competing studies, competing solutions, and disagreements. A manager must optimize with respect to an organization's overall goals by reconciling the competing interests.
Even if you should manage a small firm, you will find that diplomacy and mediation skills are crucial to the solution of the firm's problems. The tools of managerial economics