Dynamics of the Mixed Economy

Why does one failed intervention always seem to lead to another? Since the collapse of the centrally planned economies, some form of mixed economy has become the dominant paradigm guiding social and economic policy throughout the world. Yet there has been relatively little analysis of the inherently destabilizing tensions and contradictions within the mixed economy itself, nor of the underlying logic of interventionism that engenders them. Dynamics of the Mixed Economy applies the insights of modern Austrian political economy to these issues. By studying the near-and long-term repercussions of intervention under conditions of dispersed knowledge and radical ignorance, in both market and government, it reaches some troubling conclusions about the likely prospects for actual mixed economies. It compares and contrasts standard approaches to the growth of the state (including public choice) with that of modern Austrian political economy; examines in detail the nature and operation of the interventionist process in the context of nationalization, regulation and the welfare state; analyzes conditions that produce instability under laissez-faire capitalism; argues that the interventionist process is a " spontaneous order " ; and offers several " pattern predictions " regarding the character and behaviour of existing economies. articles on market-process theory, interventionism, and bureaucracy have appeared in several books and journals. A central theme of this series is the importance of understanding and assessing the market economy from a perspective broader than the static economics of perfect competition and Pareto optimality. Such a perspective sees markets as causal processes generated by the preferences, expectations and beliefs of economic agents. The creative acts of entrepreneurship that uncover new information about preferences, prices and technology are central to these processes with respect to their ability to promote the discovery and use of knowledge in society. The market economy consists of a set of institutions that facilitate voluntary cooperation and exchange among individuals. These institutions include the legal and ethical framework as well as more narrowly " economic " patterns of social interaction. Thus the law, legal institutions and cultural or ethical norms, as well as ordinary business practices and monetary phenomena, fall within the analytical domain of the economist. Dynamics of the mixed economy: toward a theory of interventionism Sanford Ikeda. p. cm.—(Foundations of the market economy series) Includes bibliographical references and index. How far your eyes may pierce I cannot tell. Striving to better, oft we mar what's well. To Jenny and Christopher ix …