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Quotation of the Day…

… is from pages 114-115 of Ronald Coase‘s 1994 collection, Essays on Economics and Economists; specifically, it’s from Coase’s 1976 superb essay “Adam Smith’s View of Man”:

Adam Smith’s argument for the use of the market for the organisation of economic activity is much stronger than it is usually thought to be.  The market is not simply an ingenious mechanism, fueled by self-interest, for securing the co-operation of individuals in the production of goods and services.  In most circumstances it is the only way in which this could be done.  Nor does government regulation or operation represent a satisfactory way out.  A politician, when motivated by benevolence, will tend to favor his family, his friends, members of his party, inhabitants of his region or country (and this whether or not he is democratically elected).  Such benevolence will not necessarily redound to the public good.  And when politicians are motivated by self-interest unalloyed by benevolence, it is easy to see that the results may be even less satisfactory.


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