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by flumbaps
4602 days ago
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I think you're creating a false dichotomy here. It's perfectly possible for a government to encourage people to work in certain areas without descending into tyranny. Most modern democratic governments already regulate their financial markets, and already invest in research grants, infrastructure projects and support for start ups. The fact is, providing incentives to work towards long term goals is exactly the kind of thing that free markets aren't good at. |
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To claim that markets are not "good" at this kind of optimization entails the belief that they should be.
I'd argue that capital allocation in the face of risk and uncertainty is a hard problem, and that while governments (in their role as infrastructure providers) make the problem easier, they (governments in their role as social planners) enact policies to alter the risk landscape to achieve desirable social/economic ends and sometimes rents for specific interest groups.