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# Provision of Information (Negative Externalities) | A-Level Economics Model Paragraph
- URL: https://www.a-level-economics-tutor.com/provision-of-information-a-level-economics-model-paragraph/
- Published: 2026-04-08T19:09:50.000Z
- Updated: 2026-08-09T15:04:37.000Z
- Author: Jaisul Naik
- Tags: Model Paragraphs

### Provision of information

One way the government could intervene in the market for fast food is through provision of information. The market for fast food has negative externalities in consumption, as consumers are driven by immediate satisfaction and under-value the long-term health costs to themselves and the burden this places on the NHS. The government could provide information through health campaigns, warning labels, or advertising restrictions, highlighting the links between fast food and conditions like obesity and heart disease. As people become more aware of these risks, their perceived benefit from consuming fast food falls, causing demand to shift to the left. This results in a lower equilibrium quantity, moving the market closer to the socially optimal level of output.

Opportunity cost Information may be ignored 

However, there is a large opportunity cost associated with setting up a national information campaign. The government would have to consider the value of the next best alternative, as spending on these advertising campaigns might mean that the government have to cut spending in other areas such as education or healthcare. The government should be confident on the effect of the information campaigns on demand, and that it won't be a waste of their budget.

However, there is a chance that the information provided will be ignored by consumers if it is not presented carefully enough, meaning there may not be enough of a change in consumer behaviour, as they might not be able to see the value in reducing their demand for the good or service. Behavioural economics also teaches us that consumers do not always make rational decisions, as they suffer from bounded rationality. Consumers have a limited ability to process and act on information, due to habitual behaviour and a poor capacity to absorb new information.

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