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Mon Jul 17 11:38:52 2006 |
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> How about the fallacy (or whatever, respecting some
> recent comments) of "market failure."
> Markets are social constructs (society agrees
> on and enforces what constitutes property, contract,
> tort, etc.);
> Fred Carstensen
To analyze "market failure," we need to distinguish a
pure free market from today's mixed economies.
Many of today's social and economic woes may be caused
by governmental intervention rather than the market,
and perhaps would not be present in a pure free
market.
Today's social constructs create interventions into
markets, and so the consequent social problems cannot
be ascribed purely to "market failure."
> If
> "markets" fail to do so, what or who has failed?
Each failure (e.g. unemployment, pollution) has to be
analyzed to determine how intervention affects the
outcome. To label all of today's failures as market
failure is to assert that all government policy is
purely benign.
Fred Foldvary
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