My colleague Martin Fransman sends me this interview with the Nobel Laureate in Economics Gary Becker for the FT. In this interview, Becker vehemently defends the positions of the Chicago School and the validity of free markets. His argument seems to have two parts:- The crisis occurred because economists still do not understand financial instruments well enough. In other words, Economics as a science is not advanced enough to deal with such issues, pretty much in the same way as medieval medicine was not ready to fight viruses or used leeches to cure diseases.
- The regulated know much better what to do than the regulator. The crisis should be solved by economic agents and not by the state because, paraphrasing Churchill's dictum on democracy, free markets are the worst economic system, except for all those other forms that have been tried from time to time.
You can watch the video here.
What do you think?
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