"Government Intervention Is Becoming Obsolete"
September 28, 2015
Remember Econ 101? Remember the "market failures" that could be fixed by government action? Fred Foldvary explains why technology is fixing them without government.
Much government intervention has no economic rationale and is due instead to pressure from special interests. However, some interventions have a public-welfare justification, backed by conventional economic theory. Textbooks in the field normally present four such rationales: asymmetric information, external effects, public goods, and monopoly.
Advances in technology are fast rendering these arguments obsolete.