College students who are assigned Tyler Cowen and Alex Tabarrok’s Modern Principles of Economics learn the twin concepts of market failure and government failure. To teach the former without the latter, as some textbooks do, is to present a lop-sided picture of the world and to romanticize governmental solutions that often do more harm than good.
Coronavirus is making this lesson tragically real, as federal agencies like the CDC and FDA have been caught off-guard by the outbreak and subsequently stoked the public’s fears while failing to provide solutions.
I was recently joined by Marginal Revolution blogger and George Mason University economics chair Alex Tabarrok. He explained how these agencies’ responses to COVID-19 has been a ‘Failure of Historic Proportions.’ Alex was recently interviewed by Reason’s Nick Gillespie on the subject, and elaborates in our interview on the urgent need for government to foster the conditions for markets to function.
Alex also talked about the hindrances to new drug approval per the framework he developed with FDAReview.org.
Watch Alex’s free online economics courses at MRUniversity.com and listen or read the transcript to understand how the economy can recovery faster with the help of better policy and the “invisible hand.”