Introduction to Dead Weight Loss (Welfare Loss)

As we've learned in earlier lessons, markets tend to achieve equilibrium prices and quantities that are efficient, as the marginal benefit of a product to its consumers equals the marginal cost to producers. But what makes outcomes other than equilibrium inefficient? This lesson looks at the impact of disequilibria on consumer and producer surplus, introducing the concept of "deadweight loss" or "welfare loss", which will further help us understand what makes outcomes other than the equilibrium quantity and price inefficient.

[realdvgarg]

I had done this concept a year ago and I was quite confident with it. But you always seem to give an edge to my knowledge. Keep it up!

[angelofrisina]

Such a great video, really helped me understand a few key points much better. Thank you!

[johnnytarkpah]

This video should be far more then 16 thousand by now because your explanation is one of the simplest on the subject

[vivekanand]

Thanks Sir... for good explanation of D. W. Loss.. 🙏🙏

[chrisweber]

Do tarrifs create a surplus of quantity or do they behave differently than other types of price floors?

[footballandsoccerhq]

How do we know that the producers with the greatest surplus will sell at 7? How come others that can make a producer surplus who can sell from 3 to 7 dollars won't be able to sell the beef?

[lydiabrobbey]

A little clarification, I thought the new producer surplus would be the very little triangle (3m) beneath and not including the rectangle (12m).

[tomtomgaming]

Why does he time the base with 6 when finding consumer surplus and producer surplus?

[geraldinemateos]

Thank you !! the video was very helpful :)

[raajrajan]

good preentation.you can also dsicuss what is optimum tax gdp ratio

[moammadaliyaqubi]

(7-3)*3 you didnt divide it by 2, while you did for calculating other two welfares!

[mvrma]

what is the logic behind devided by 2? please explain

[vitalliao]

Why my professor doesn't teach in this way in class?? so we are all better off./ Come on teacher

[MrMurfle]

Why would you want to maximize total surplus ('welfare') where consumers are many and typically not wealthy and producers are few and typically very wealthy, as would be the case for many products? A dollar to a poor or average person would be worth more to them than to the fat-cat producers.

[woodpecker]

Excuse me why am i watching it in Deadpool 2 Playlist..?