Technology subverts more markets

Posted by Graeme in Market failure at 8:06 am on Saturday, 7 April 2007

It looks like it is not just consumers who are unable to make informed rational decisions when faced with technology. It appears that Indian cotton farmers have a similar problem when faced with choosing GM seed varieties. In this case as they would clearly wish to choose according to rational criteria, but they cannot.


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Technology drives consumers to irrationality

Posted by Graeme in Market failure at 10:36 am on Thursday, 15 February 2007

Technology, and the development of technological products, undermine free market mechanisms. One, of many, reasons for this is the problems consumers face in making a choice about purchases. Does this affect the assumption that consumers are able to make informed and rational decisions, which is required by the argument in favour of free markets? (more…)

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Drug patents: inefficient R & D funding

Posted by Graeme in Economics,Market failure at 11:39 am on Sunday, 4 February 2007

Patents allow pharmaceutical companies to sell drugs at several times the price they would be able to get in a competitive market. Only a small proportion of the extra money spent by the public goes into research and development (R & D), despite the latter being the supposed benefit of the higher prices. (more…)

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Bad incentives in drug development

Posted by Graeme in Market failure at 12:40 pm on Wednesday, 31 January 2007

The pharmaceutical industry would like you to believe that they fund the expensive development of new drugs, they get patents in return, and this provides a nice efficient market driven mechanism for developing new drugs. There are many things wrong with this picture: (more…)

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