If the social value of producing robots is greater than the private value of producing robots, the private market produces too few robots.

Question

Quizplus · Accepted Answer

When the social value of producing robots is greater than the private value, it means that there are additional benefits to society from robot production that the producers do not capture. As a result, the private market, focusing on private benefits, will produce fewer robots than is socially optimal, leading to underproduction from a societal perspective.

If the Social Value of Producing Robots Is Greater Than