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“There’s somebody in Bangladesh who would nearly absolutely be a greater economics professor than I’m and is now behind a water buffalo,” he advised me. “The market financial system provides me and my preferences 200 instances the voice and weight of his. If that isn’t the largest market failure of all, I don’t know what your definition of market failure may probably be.”
That is from Annie Lowrey, “The Economist Who Is aware of the Miracle is Over,” The Atlantic, September 3, 2022.
Don Boudreaux has made the purpose that it’s onerous to assert this as market failure when Bangladesh is a rustic whose markets are most repressed by authorities. He factors out that within the 2022 version of the Annual Report on Financial Freedom of the World, about which I’ll have extra to say in a day or two, Bangladesh ranks a dismal 139th out of 165 international locations which are rated. That’s a serious contributor to the water buffalo driver’s poverty. I received’t say extra about that as a result of Don stated it effectively.
However there’s one other level to make. The Bangladesh authorities is just not the one authorities stopping that water buffalo driver from being an economist: governments in richer international locations equivalent to the USA additionally play an enormous function. No matter you consider restrictions on immigration, they are restrictions; they’re heavy regulation of the labor market. If the USA considerably relaxed its restrictions and let, say 5 million Bangladeshis into the nation, that water buffalo man may truly get right here and turn into an economics professor.
And Brad could be proper: this former water buffalo driver may effectively do a greater job than Brad at instructing what’s, and what’s not, market failure.
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