Tuesday 16 Aug 2022 | 05:17 | SYDNEY
Tuesday 16 Aug 2022 | 05:17 | SYDNEY

Reader riposte: More on picking winners

26 October 2010 14:57

David responds to Sam Roggeveen's post arguing that 'governments ought to get involved only where market incentives are weak':

How about stating the positive: 'governments ought to get involved where objectives are clear and market incentives are weak or poorly aligned to objectives'.

I suggest governments should include benefits in productivity and consequent tax revenues against costs. The NBN, national infrastructure, water, energy, transport, ports, societal improvements through education, health are all candidates that are obvious because of their national scale and market incentives are generally poorly aligned to universal service.

In other cases, government involvement should be achieved through tax or regulatory means: management of supply and demand for renewable energy and climate change responses, equipment and usage behaviour modification.