Tweet [1]
… is from page 97 of an advance copy of Samuel Gregg’s forthcoming book, The Next American Economy: Nation, State, and Markets in an Uncertain World [2]:
No government department [charged with carrying out industrial policy] – let alone a single technocrat – can know if the forgone alternatives might have been more profitable; or might have produced even more growth, innovation, or spillover effects for a greater number of businesses and consumers; or even have helped a region or social group overcome some of its economic challenges. No legislator or expert can consequently claim with any meaningful degree of certainty that a particular industrial policy will produce more such benefits than would have resulted if the state had not implemented the policy. They simply do not know what might have otherwise occurred.
DBx: Yes. And thus advocates of industrial policy – in order to escape the fundamental problem posed by government-officials’ inescapable ignorance – must assume that miracles occur [3].