The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design. – F.A. Hayek
Posted in Fun Facts, Market Failures on Apr 24th, 2012
According to one survey, over half of college students surveyed believed they can detect someone with an STD … just by looking at them. In other news: calls for RE-regulating the airline industry are rearing their ugly head. Might I offer the possibility that further de-regulation may be helpful? Or perhaps that maybe there should [...]
Posted in Health Care, Market Failures, Price System, You Can't Have it Both Ways on Apr 24th, 2012
The query in the title suggests an epic post, but we’ll keep it simple today. Let me ask folks what they think of a policy proposal that does the following: Examines the entrepreneurial ability, dynamism, job creating tendencies, etc. of companies and puts companies into two groups: dynamic/productive and stagnant/destructive. Takes the dynamic companies and [...]
Posted in Market Failures, Politics on Mar 28th, 2012
I promised you yesterday that I would repeat this point. A public good is NOT a good that is provided by government. Find a new name for it. I have offered up in the past calling those things “government goods.” Public schooling is far more accurately called government schooling than public. The word “public” has [...]
Posted in Economic Illiteracy, Economics Problems, Market Failures, You Can't Have it Both Ways on Feb 2nd, 2012
I cannot even begin to tell you how many times I am told, “yeah, supply and demand and prices work and all that, but if we allow them to run wild, the environment will inevitably be destroyed.” These arguments are often levied far more vehemently in the presence of classical liberals than in more mainstream [...]
Posted in Market Failures on Nov 21st, 2011
Would you characterize my inability to get from NY to London via airplane in 1886 a market failure? You might. After all, we had markets at that time, and the market did not “deliver” the goods. But that is no reason to call it a market failure. Why? Well, we had governments at that time, [...]
Posted in Central Planning, Market Failures, Price System, Property Rights, You Can't Have it Both Ways on Oct 28th, 2011
Among the avalanche of policies that has been enacted in the name of igniting a green economic revolution (taxes, subsidies, loan guarantees, tariffs, …) include mandates for use of particular technologies. Good economists will understand the basic problem with mandates (they are a classic input standard, which is theoretically and empirically inferior to output standard [...]
Posted in Classical Liberalism, Market Failures, Taxation, You Can't Have it Both Ways on Oct 6th, 2011
Let’s return to the original claim: the reason the rich should pay more in taxes is that they were only able to earn their income by hiring people that went to (taxpayer funded) public schools, employ people who drove on (taxpayer funded) public roads and otherwise could not do what they do were it not [...]
Posted in Environment, Market Failures, Regulation on Aug 29th, 2011
According to this figure, global carbon dioxide emissions last year amounted to about 30.4 billion tons. The US contribution was slightly more than 5 billion tons. The IPCC estimates that the damage caused by a ton of CO2 is roughly $25. Putting these together, it seems to be that the annual damage* caused by CO2 [...]
Posted in Economic Illiteracy, Market Failures on Aug 11th, 2011
When folks stumbled upon the idea that “externalities” constituted a “market failure” it really breathed new life into the forces of economic interventionism. A quick review, sulfur dioxide emissions/pollution is a classic externality. Why? Energy companies (profit seeking of course) burn coal to produce electricity, which they sell to customers to make a profit. As [...]
Posted in Health Care, Market Failures, Regulation, You Can't Have it Both Ways on Jun 22nd, 2011
One of the few things I am actually an alarmist about is biological pandemics. Given the past 50 years of US history I have no reason to be this way, but as this Megan McArdle post illustrates, there has been a really disturbing trend happening in medicine over the last 30 years: The first shows [...]
![[Most Recent Quotes from www.kitco.com]](http://www.kitconet.com/charts/metals/gold/t24_au_en_usoz_2.gif)
![[Most Recent Quotes from www.kitco.com]](http://www.kitconet.com/charts/metals/silver/t24_ag_en_usoz_2.gif)