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Title of the item:

BRUNO S. FREY AND JOSEPH E. STIGLITZ ABOUT GOVERNMENT FAILURE AND MARKET FAILURE

Title :
BRUNO S. FREY AND JOSEPH E. STIGLITZ ABOUT GOVERNMENT FAILURE AND MARKET FAILURE
Authors :
Mirosław Bochenek
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Subject Terms :
Law
Economics as a science
HB71-74
Source :
Ekonomia i Prawo. , Vol 6, Iss 1, Pp 71-86 (2010)
Publisher :
Uniwersytet Mikołaja Kopernika, 2010.
Publication Year :
2010
Collection :
LCC:Law
LCC:Economics as a science
Document Type :
article
File Description :
electronic resource
Language :
English
ISSN :
1898-2255
2392-1625
Relation :
http://apcz.umk.pl/czasopisma//index.php/EiP/article/view/542; https://doaj.org/toc/1898-2255; https://doaj.org/toc/2392-1625
DOI :
10.12775/EiP.2010.005
Access URL :
https://doaj.org/article/12c1accf885a4781b5e6e4896878beca
Accession Number :
edsdoj.12c1accf885a4781b5e6e4896878beca
Academic Journal
One of the most fascinating economic issue is effectiveness of operating of resources allocation mechanisms. During 250 years, mercantilists were favouring a nation, later Adam Smith convincingly substantiated, that only market mechanism enables nations to achieve prosperity, however John Maynard Keynes postulated ‒ during the Great Depression ‒ a state intervention in economy. New more sublime arguments have appeared at issue of market failure and government failure. Several years ago, Joseph E. Stiglitz and Bruno S. Frey suggested an interesting solution to this problem. They maintain that it disappoints government, as well as market. J.E. Stiglitz claims that the state should intervene only in cases when it has possibility to reduce market failure. He postulates government and market co-operation, what can result in their reinforcement and effective solutions for social problems. Whereas, B.S. Frey notices that only a powerful nation is able to make rules for an economic game, which enable private markets to operate well. Each time, comparative analysis of costs and profits of market and state operating should make a decision which resources allocation mechanisms to choose.

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