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There's a dogma that regulation is de facto inefficient and bad generally, and I think it's almost universally accepted that that's the case for the self-intere
by wolverine876 3y ago
There's a dogma that regulation is de facto inefficient and bad generally, and I think it's almost universally accepted that that's the case for the self-interest of businesses. But like any dogma, any prejudice, it's wrong:
Businesses have self-interest; it's overwhelming and they can't escape it and its biases (though they can and should moderate it, and some businesses do that much better than others). Regulation provides an independent, expert power structure with great value where self-interest, or multiple self-interests, fail. It allows competitors to coordinate; to act with enlightened self-interest and (gasp) in the public interest - lawlessness is bad for business.
For example, in financial markets, unregulated self-interest leads to mountains of fraud, and a place where nobody wants to invest - that hurts everyone. A safe, fair marketplace attracts everyone.
For airplane manufacturers, self-interest drives manufacturers to cut corners. If you've ever advocated against cutting corners because of an over-the-horizon, non-specific risk (meaning, the consequences won't be tomorrow, and we can't say exactly what and when they will be), you know that you are violating social norms and can be very unpopular. But if you can say, 'this violates FAA regulations', then it's a clear and specific risk.
- marcosdumay 3y agoHum... Regulators are inefficient. Regulations exist for stopping society from getting stuck into suboptimal Pareto equilibria. So you don't want regulators to do things that are not their minimum job, but anybody with a general argument against regulation is just trying to rob you.
- wolverine876 3y ago> Regulators are inefficient. What do you mean by that?
- marcosdumay 3y agoThe theory goes that the regulation organization has no reason to run at its best performance. Because it's necessarily a monopoly (works best when it's the government itself), and because there's a lot of pressure into its continued survival. So, as a rule, the work of regulators aren't optimized at all. Of course, the real world is much noisier than that. But the most that free market advocates can claim is that regulators are inefficient, never that regulations are. Unless they are talking about some specific regulation.
- wolverine876 3y agoI see what you meant. > the most that free market advocates can claim is that regulators are inefficient Beware of buying into their language. Regulations are necessary to free markets; unregulated markets can turn into monopolies or similar, making them very un-free.
- marcosdumay 3y agoI hardly disagree here. If we stop using some word just because some con-man said them, we'd run out of words much faster than we could agree on new ones. And worse yet, we'd give the con-man the power to decide what gets discussed or not, and would legitimize the behavior of switching words like they were fashion accessories, that is one of their main strategies.