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Flaws in Conventional System - Focus
The traditional measures focus mainly on goods and services that are bought and sold in the market and ignore the non-marketed goods and services provided by the natural assets. For example, forests provide many environmental services like flood control, protection from soil erosion, carbon sequestration and amenity values in addition to marketed products like timber and fuel-wood.
For many of the non-timber forest products (NTFP) provided by the forests there exists no market. The conventional national income accounts would only consider the economic contribution of forests and ignore the environmental services and the NTFP for which there exist no market. Similarly, the waste disposal services of the environment are not recorded in the national accounts.
The other type is called ex-post heterogeneity which refer to the conflict (of interests) arising due to distributional implications of the public policy. Thus when a public polic
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The meaning of a market economy is in which the decision and production are prepared. The consumption of goods services are based on voluntary swap in markets.
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