Market Failure, Dead Ahead


Columbia University's Eli Noam has seen the future of the information economy and it ain't pretty. In fact it is "a volatile, cyclical, unstable mess." So bad in fact, that governments should consider deliberately encouraging low-tech industries so the entire economy will not be volatile, cyclical, and unstable.

Two thoughts. One, who said things were going to neat and tidy? Flooding the globe with info was destined to bring more creative brains into the wild mix of human activity. Nobody said it would be easy to figure out what everyone would do with more information.

Second, if things are so bad and getting worse, why not just go ahead and toss off all the outcome-distorting regs on the information sector like must-carry rules, universal service mandates, and the like? Indeed, close down the FCC and just go home and await the End. Or are we supposed to start work on our iron smelters straight away?