How Much Do You Trust the Government? Politics, Patients, and Perverse Incentives

By John C. GoodmanThe Independent Institute

Just as noneconomists think wages can be set at any level, some people think that any public policy is possible. If wages are judged to be too low, the noneconomist thinks that’s because the business owner is hardhearted. If a public policy is judged insufficiently generous, the person unfamiliar with public choice thinks that public officials are hardhearted. In both cases, the error is the same: the belief that decision makers have enormous discretion when, in fact, they have very little.

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