The figure given below represents an imperfectly competitive resource market. Here common land (and not land used for specific purpose) is under consideration.Figure 18.1

-Lack of well-defined ____ may cause market failures.

Question

The figure given below represents an imperfectly competitive resource market. Here common land (and not land used for specific purpose) is under consideration.Figure 18.1
 
-Lack of well-defined ____ may cause market failures.

Quizplus · Accepted Answer

In an imperfectly competitive resource market where common land is under consideration, lack of well-defined private property rights may cause market failures. Without well-defined ownership and property rights, there is no incentive for anyone to invest in the land or maintain it properly, leading to the tragedy of the commons where the common resource is overused or exploited. This can result in a market failure where the resource is depleted and the market cannot efficiently allocate it.

The Figure Given Below Represents an Imperfectly Competitive Resource Market