Does Positive Externalities Result in Market Failure?

With positive externalities, the buyer does not get all the benefits of the good, resulting in decreased production. ... In this case, the market failure would be too much production and a price that didn't match the true cost of production, as well as high levels of pollution.

What do positive externalities result in?

Positive externalities also result in inefficient market outcomes. However, goods that suffer from positive externalities provide more value to individuals in society than is taken into account by those providing the goods.

What happens when positive externalities are present in a market?

When positive externalities are present, it means that: Individuals don't take into account all the benefits associated with their market choice.