Economics, 3rd Edition

Gini coefficient 

a measure of the degree of inequality of 

income in a country

government failure 

a situation where political power and 

incentives distort decision making so that decisions are made 

which conflict with economic efficiency

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808  GLOSSARY

government purchases 

spending on goods and services by 

local, state and national governments

gross domestic product (GDP) 

the market value of all 

final goods and services produced within a country in a given 

period of time

gross domestic product per capita (head) 

the market 

value of all goods and services produced within a country in a 

given period of time divided by the population of a country to 

give a per capita figure