Bleg for Progressives – Which Micro Arguments Am I Missing?
December 22, 2012
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An undergraduate majoring in economics will come across a number of potential market failures that may or may not demand government intervention. Setting aside macroeconomics, these sources of market failure would include,
- Public Goods / Public Bads
- Stiglitz/Akerlof things
- Market power
And so on.
Then there are the free market responses which I saw (at most) in a very limited way in undergrad but constitute the modern responses to arguments for intervention.
- Coase theorem
- Public Choice
- The UCLA approach to micro
- Hayek/Kirzner view of markets
And so on.
My question is this – what are the equivalent to these arguments from the left? One that comes to mind is behavioral economics, which I am familiar with because I’m more or less a behavioral economist, and in any case it has been fashionable for the better part of a decade at this point.
Are there “novel” theoretical arguments that I haven’t come across? Without going too far left (e.g. Steve Keen) or getting tied into knots over equity concerns, what is missing from my analysis?