Car Congestion By Kyung-Min Ro Links http://www.youtube.com/watch?v=dDoNBYvcTs http://www.youtube.com/watch?v=qun9jiLw w8M http://www.youtube.com/watch?v=ZHlxdkdT aX8&NR=1 Why is it market failure? Costs PMC=SMC Deadweight loss PFM PS PMB SMB QS QFM Output Why is it market failure? The consumption of cars is a market failure because consumers only consider their own costs and benefits of consumption. For example, by over consuming the cars congestion occurs which slows down economic activities but the costs is not paid by consumers. Also, spill over costs are imposed on 3rd parties for enlarging the roads.