Syllabus T. Y. B. A. Paper : IV advanced economic theory with effect from academic year 2010-11 in idol

Complementary market from the word itself means 
mutually providing each other‘s need. Thus, complimentary market 
is the coordination between two potential products that helps each 
other to survive in the market industry. 
A good example of this is the products toothbrush and 
toothpaste. Assume that without toothpaste there would be no 

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toothpaste; also, without toothpaste there would be no toothbrush 
in the market. Being this the case, the producers of these products 
would always depend on each other. Therefore, the producer 
should compliment each other so there would be a good market for 
both of them. 
Thus, acting alone in this kind or market would produce 
market failure. Using our example above, the potential toothpaste 
producer and the potential toothbrush producer need each other to 
survive and be able to get the public interest. Also, such 
coordination is important especially to developing countries. 
5. Information Failure 
Information failure occurs when producers does not inform 
their consumer of the possible harm of their product. Not informing 
or inaccurate information can be harmful to the consumer and may 
give a bad reputation for the product. Vague directions can also be 
an example of this.
The role of the government here is minimizing the 
occurrence of information failure. To make this efficient, the 
information must be widely and accurately disseminated. One of 
the possible reasons why information failure occurs is that 
disseminating this information would be very costly. The 
manufacturer should not forget 
that consumer‘s welfare should 
always be prioritized. 
6. Unemployment, Inflation, and Disequilibrium 
Unemployment is one of the major indicators of market 
failure. The issues regarding unemployment and inflation are so 
complicated that they are in separate course in macroeconomics. 
Unemployment is described as frictional, seasonal,