EconTalk
Does Market Failure Justify Government Intervention? (with Michael Munger)
Jun 17, 2024
Michael Munger, an economist at Duke University renowned for his insights on public choice theory, discusses the complex interplay between market failure and government intervention. He highlights the often-overlooked concept of government failure and questions whether interventions truly outperform market outcomes. Munger examines decision-making in healthcare, advocating for a balance between democratic values and expert governance. He critiques bureaucratic efficiency perceptions and emphasizes the need for innovative solutions beyond traditional government or market roles.
01:08:04
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Quick takeaways
- Government failure involves substantive failures like regulation and law enforcement, not just correcting market failures.
- Procedural government failures occur when decisions do not lead to mutually beneficial outcomes, questioning the effectiveness of government intervention.
Deep dives
The Necessity of Government Failure
Government failure is not just about correcting market failure but encompasses substantive failures like regulation, adjudication, currency stability, border control, and law enforcement. Maintaining core state functions is vital for governments to avoid failure, focusing on what they do best rather than trying to do everything.
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