Government intervention in private markets: Not a silver bullet

As yesterday’s article showed, economists are a funny bunch.

Even when we have been exposed to similar life experiences and education training, we always find something to disagree over. It could be about the power of trade unions, whether to tax citizens more or less during an economic recession or in the case of the Stears Business editor-in-chief and I, what the appropriate size of the government should be.

I have to give it to Tokunbo though, he makes a compelling argument. Figuring out how to reduce wait times in petrol stations and maximise the space in your fridge aside, markets can be beautiful, but markets can also fail. When this happens, only the government can step in to save the day. Think about how the government used bailouts to stabilise the banking sector back in 2010. Or when we expect the government to step into situations where big businesses