The point about markets can be explained more simply:
It is very difficult to make people improve.
It is very easy (and very cheap) to find out who does something best.
-Commenter “P. Froward” in this thread at another blog.
4 thoughts on “Quote of the Day”
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I think that the great strength of the free-market is its experimental nature. It quickly separate bad ideas from the good. Most critics of the free-market don’t think of economic endeavors as creative ones that must be repeatedly tested.
Markets happen anyway.
In an economy regulated and managed to eliminate “market” forces, a market springs up which trades in the attention and influence of the regulators and managers. It is almost certain to be extremely distorted because its currency will not be anything easily recognizable as “money”, and because its existence must be denied by the participants since it is defined as “corrupt”.
So attempting to elminate a market simply creates another one; markets happen anyway.
I wish somebody brighter and better educated than I am would examine that notion more deeply.
Regards,
Ric
Ric,
You will be happy to know that this is precisely the focus of the literature on public choice, political economy, regulation, and the economics of institutions.
Markets in everything and how creating bad rules creates markets to benefit from those bad rules…
As I recall, it is the Russians that have the saying or proverb “There is always a market, even on Sunday.” And, such is still the case in the Soviet Union, even though “free markets” are seriously discouraged.