Government Failure vs. Market Failure
Principles of Regulation - Working Paper #144
In this paper, the author outlines the principles underlying the modern theory of regulation. Section I presents the rationale for regulation—why regulation is required. Section II discusses the forms that regulation can and should take. Section III applies these principles to three subjects of current concern: sovereign wealth funds, financial market regulation, and environmental regulations directed at greenhouse gases.
About the Author
Initiative for Policy Dialogue (IPD)
Joseph E. Stiglitz is co-President of the Initiative for Policy Dialogue, and Chairman of the Committee on Global Thought at Columbia University. He is University Professor at Columbia, teaching in its Economics Department, its Business School, and its School of International and Public Affairs. He chaired the UN Commission of Experts on Reforms of the International Monetary and Financial System, created in the aftermath of the financial crisis by the President of the General Assembly. He is former Chief Economist and Senior Vice-President of the World Bank and Chairman of President Clinton’s Council of Economic Advisors. He was awarded the Nobel Memorial Prize in Economics in 2001.