Pelikan, Pavel (Prague University of Economics and The Ratio Institute)
Abstract
Recognizing that human rationality has bounds that are unequal across individuals entails treating it as a special scarce resource, tied to individuals and used for deciding on its own uses. This causes a meta-mathematical difficulty to the axiomatic theories of human capital and resource allocation, and raises a new problem for comparative institutional analysis, allowing it to explain some so far little understood differences between markets and government. The policy implications strengthen the case against national planning, selective industrial policies, and government ownership of enterprises, but weaken the case against paternalism.
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Publisher Info
Paper provided by The Ratio Institute in its series Ratio Working Papers with number
85.
Length: 43 pages Date of creation: 21 Mar 2006 Date of revision:
03 Sep 2006 Handle: RePEc:hhs:ratioi:0085
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Find related papers by JEL classification: A10 - General Economics and Teaching - - General Economics - - - General D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data) H10 - Public Economics - - Structure and Scope of Government - - - General O16 - Economic Development, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment P51 - Economic Systems - - Comparative Economic Systems - - - Comparative Analysis of Economic Systems
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