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Showing posts from November, 2010

The Failure of the “Market Failure” Argument

Dr. John Hasnas, Law professor at Georgetown University, gave a lecture to the Students for Liberty (Webminar Series) on November 8, 2010. Hasnas lecture was not on the Market Failure (MF) but rather the FAILURE of the Market Failure argument. Hasnas exposed his arguments against the MF from his knowledge in law and ethics. Hasnas could not being more eloquent in establishing the distinction of what constitutes for him the disappointment in the argumentation of the defenders of the subject in question.
I will now share my notes from Hasnas’ lecture:
The Market Failure (Definition according to Hasnas): The market is full with transactions that happen simultaneously. There are unregulated voluntary as well as regulated voluntary transactions. However, the market failure occurs when the good outcome(s) of these transactions affect negatively third parties. Advocates of the MF often mention the following examples when the “market fails;” air pollution, deforestation, water contamination t…