Quote:
Originally Posted by Luap
By this do you mean that free markets work perfectly or do you mean that they can correct their own problems more efficiently than a public sector can? Either way, I have to wonder: how do you know? In theory, the private sector does sound like it can solve all of society's problems, but in application, is that true? Some blame the East Asian crisis and the ensuing troubles on a lack of regulation--you think otherwise?
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Not even in economic theory. There are certain cases that can lead to a market failure. Like with public goods, natural monopolies, external effects, moral hazard, etc. Markets are very powerful tools, but we can't expect them to solve all problems. And that's the reason why there always will be the need of a limited public sector and government regulations.