To Intervene or Not to Intervene

Perfectly competitive markets are rare. Maximizing welfare usually requires government intervention - more regulation, not less. Maximilian Auffhammer on Berkeley Blog:

“Further, we have recently learned that the Social Cost of Carbon in federal rulemaking is at risk. The Social Cost of Carbon is a number used in federal benefit cost analysis, to incorporate the global damages from greenhouse gas emissions. The president could, for example, instruct agencies to use a domestic cost of carbon, which is a fraction of the true damages from carbon emissions. This would further increase emissions.”

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