Emerging Disorder

Frequent readers know that I go on and on about how order emerges from markets. But what happens when government tampers with markets? We have a good example with Fannie and Freddie. Russell Roberts offers one of the most fair-minded and non-technical explanations of the situation and calls it an “emerging mess“. Maybe he had his tounge in his cheek, but I think a fair case can be made for emergent disorder. When governments interfere with markets, no matter how well intentioned, government has limits that the markets don’t. This leads to sub-optimal, or even downright terrible, results.


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