July 28, 2004
Quote of the Day
...to fix the "market failure", the government must somehow actually act to supply the missing good, either directly or via government contracts. Because there is no market discipline enforcing the efficient delivery of government services, these services are often supplied in a stunningly bad manner. You can't go to the competing DMV — there is none — so you wait on line for hours to get your drivers license. Why should we expect that the efficiency with which, say, national defense or other purported "public goods" will be supplied would be any greater?
So, here is the crux of the problem with the "let the government supply the public goods" argument: there is no evidence the government can supply putative "public goods" with any greater efficiency than the market that has "failed". Indeed, one might even get less efficiency than one started with. Why, then, is government intervention any better than the "market failure" we started with?
Posted by Russell Whitaker at July 28, 2004 01:23 AM | TrackBack