What's it: Deadweight loss is the loss of surplus by producers or consumers because the market is in disequilibrium. These losses reduce the economic surplus (social welfare) because it is not captured by either party transacting in the market
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What's it: Deadweight loss is the loss of surplus by producers or consumers because the market is in disequilibrium. These losses reduce the economic surplus (social welfare) because it is not captured by either party transacting in the market