Government Failure in Decision-Making Processes

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The chapter explores the complexities of decision-making processes, debating whether politicians or engineers should determine infrastructure spending. It delves into the effectiveness of expert committees in governance, highlighting examples like the Federal Reserve and the Supreme Court. The discussion challenges the notion of government failure being limited to addressing market failures, emphasizing the importance of government in setting essential rules for effective market operation.

Economics students are often taught that government should intervene when there is market failure. But what about government failure? Should we expect government intervention to outperform market outcomes? Listen as Duke University economist Michael Munger explores the history of how economists have thought about this dilemma and possible ways to find a third or even fourth option beyond government or markets.