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The theory of government failure developed by public choice economists is also called “the non-market failure theory”. The government failure theory in short, explains the negative results of the regulations and interventions made by the state to the economy. As market failure exists according to public choice economists, government can also fail due to various reasons. When the government intervenes in the economy to cure an economic problem only ends up creating more problems. In sum, government failure is imperfection in government performance and explores the deficiencies of political decision making process.
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