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Pros And Disadvantages Of The UK Housing Market

1476 Words6 Pages

The housing market is a key issue. With various price rises in renting of houses, consumers have found it harder to afford such places of shelter; the cost of standard living is expensive, Take Bermuda for example. its cost of living index amounting to 133.68. (Jones C. 2017). Will the government intervene once again and restore parity to cost of common residences? I will be viewing the UK housing market system and provide a thorough evaluation as to whether government intervention is mandatory in the aspect of housing market. Free market is a market determined by the consumers and producers. Resources in this type of market are only allocated to those who can afford it, which deduces that there is constant inequality of income amongst individuals, for example, Hong Kong. They’re known to possess the lowest income tax, statistics justifying their tax “starting at 2% and ending at 17%.’’(https://www.guidemehongkong.com/business-guides/staffing-your-business/hong-kong-salaries-tax-guide) …show more content…

Market failure is a scenario whereby a country allocates inefficient resources to the public, rendering the final products worthless. For example, Countries like USA waste $1 trillion per year on health care. Market failure originates from several factors: Merit goods, demerit goods, monopolies, externalities, imperfect information, and so on. Government intervention is an act made by the government to allocate goods efficiently to correct market failure. For instance, the Chinese Government has intervened in their market failure through allocation of transport, electrical power, etc. They’re 3 main types of government intervention: direct provision, subsidy and regulation intervention, but they all have their limitations, e.g. embezzlement, corruption,

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