Friday 24 Sep 2021 | 22:03 | SYDNEY
Friday 24 Sep 2021 | 22:03 | SYDNEY

Reader riposte: Picking winners

21 October 2010 17:31

Kien Choong writes:

On Sam's comment about 'picking winners', I seem to recall hearing Jeffrey Sachs making a comment to the effect that it is important to pick technologies, and the normal free market prescription of letting the market choose doesn't apply to the global challenge of addressing climate change.  In fact, I think I heard him make that very comment via podcast at a presentation he gave at the Lowy Institute!

Via Google, here is what I found:

'Economists like to set corrective prices and then be done with it, leaving the rest of household and business decisions to the magic of the market. This hands-off approach will not work in the case of a major overhaul of energy technology. We will need large-scale public funding of research, development and demonstration projects; intellectual property policies to promote rapid dissemination to poor countries; and the promotion of public debate and acceptance of new options. We will need to back winners, at least provisionally, to get new systems moving.'

Professor Sachs seems to be advocating a more hands-on approach, yes'

Even a free-market economist like Tyler Cowen seems sympathetic to Professor Sachs' view.