Political robber barons
ECONOMISTS have never agreed about how to deal, theoretically, with government regulation of the marketplace. They have attempted to account for, or to dispute, the need for such regulation and to examine the motivations and incentives of those who seek to regulate. For a long time, many economists assumed that government was comprised of public spirited individuals who spent most of their time providing public goods and correcting the “spillover” effects generated by trades in private markets. These unpleasant side effects (although there are beneficial spillover effects too) are now called “market failure.’” The more economists looked, the more such failures they discovered, with each new discovery creating, under the standard view of regulation then widely accepted, further justification for corrective government regulatory interventions.