Generally in a pure market system the answer to the question “Who will get the o
ID: 1220586 • Letter: G
Question
Generally in a pure market system the answer to the question “Who will get the output” is that the people who are willing and able to pay the existing market price get the output. If you cannot pay for the product or service, you do not get to have the product or service. This is true for all products and services, including food, housing, clothing, cars, education, etc. What do you think about this feature of a market system? Do you think it is fair? Why or why not?
NOTE: Do not answer this question based on what happens in the United States. The United States does not have a pure market (capitalist system). The US has a mixed market system in which the government will provide some assistance if a person cannot afford food, etc. A mixed market system includes some elements of a planned system. In a pure market system the government would not provide any assistance to those who could not afford whatever the product or service is.
Explanation / Answer
The situation of a market in which those who can afford to pay the price of a good will only get the good is somewhat not fair.
If we consider a huge market with multiple products, we may end up classyfing goods and services under various categories. For example some products will be luxurious such as SUV vehicle, dinning at five star hotel, world tour etc. Some would fall under comfort products like cooler or refrigetor in summers, clean and comfortable matress with a tv to watch, weekend recreational activities like movie etc. Others will be counted as necessity goods and services such as food, sanitation products, health care services, education, clohing and shelter.
The products that come under last category of necessity products should not have such featrue of "getting only if capable of paying". As we know in an economy many social and economic classes live. The poor and weaker section if do not get enough income to purchase these products at given prices they will be deprived from basic necessities of life. That will lead to more misery of such sections of society. In turn they will be more poor than before. This a typical market failure.
Thats why, to comabt such failure of market, usually governments sell these goods on concessional prices to poor sections or inervene in markets to protect their interest.
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