Definitions for market distortion
mar·ket dis·tor·tion

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1. Market distortion

   In neoclassical economics, a market distortion is any event in which a market reaches a market clearing price for an item that is substantially different from the price that a market would achieve while operating under conditions of perfect competition and state enforcement of legal contracts and the ownership of private property. A distortion is "any departure from the ideal of perfect competition that therefore interferes with economic agents maximizing social welfare when they maximize their own". A proportional wage-income tax, for instance, is distortionary, whereas a lump-sum tax is not. In a competitive equilibrium, a proportional wage income tax discourages work.In perfect competition with no externalities, there is zero distortion at market equilibrium of supply and demand where price equals marginal cost for each firm and product. More generally, a measure of distortion is the deviation between the market price of a good and its marginal social cost, that is, the difference between the marginal rate of substitution in consumption and the marginal rate of transformation in production. Such a deviation may result from government regulation, monopoly tariffs and import quotas, which in theory may give rise to rent seeking. Other sources of distortions are uncorrected externalities, different tax rates on goods or income, inflation, and incomplete information. Each of these may lead to a net loss in social surplus. Market distortions are events, decisions, or interventions taken by governments, companies, or other agents, often in order to influence the market. They are often the response on market failures, i.e., circumstances that prevent perfect competition and achieving an optimal equilibrium in the market.

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1. Market distortion

   In neoclassical economics, a market distortion is any event in which a market reaches a market clearing price for an item that is substantially different from the price that a market would achieve while operating under conditions of perfect competition and state enforcement of legal contracts and the ownership of private property. In this context, "perfect competition" means: all participants have complete information, there are no entry or exit barriers to the market, there are no transaction costs or subsidies affecting the market, all firms have constant returns to scale, and all market participants are independent rational actors. Many different kinds of events, actions, policies, or beliefs can bring about a market distortion. For example: almost all types of taxes and subsidies, but especially excise or ad valorem taxes/subsidies, asymmetric information or uncertainty among market participants, any policy or action that restricts information critical to the market, monopoly, oligopoly, or monopsony powers of market participants, criminal coercion or subversion of legal contracts, illiquidity of the market, collusion among market participants,

How to pronounce market distortion?

1. Alex

   US English

   David

   US English

   Mark

   US English

   Daniel

   British

   Libby

   British

   Mia

   British

   Karen

   Australian

   Hayley

   Australian

   Natasha

   Australian

   Veena

   Indian

   Priya

   Indian

   Neerja

   Indian

   Zira

   US English

   Oliver

   British

   Wendy

   British

   Fred

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   Tessa

   South African

How to say market distortion in sign language?

Numerology

1. Chaldean Numerology

   The numerical value of market distortion in Chaldean Numerology is: 2

2. Pythagorean Numerology

   The numerical value of market distortion in Pythagorean Numerology is: 4

Examples of market distortion in a Sentence

1. Andrea Cicione:

   Any kind of market distortion by investors agreeing to cause the distortion goes against the smooth and transparent functioning of markets.

References

1. ^ Wikipedia
   https://en.wikipedia.org/wiki/Market_Distortion
2. ^ Wikidata
   https://www.wikidata.org/w/index.php?search=market distortion