Market Effects

Market Effects are the result of changes in the local incentive structures and patterns of opportunity caused by the introduction of new resources. The new resources noticeably affect incomes, wages, profits, and prices so that people’s perception of economic winners and losers changes.

Market Effects, like distributional effects, are ways that new resources give some people and groups advantages over others. It is clear that any pattern of effects that favor some individuals and/or groups over others can increase tensions between those that gain and those that do not gain—or who lose.

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