Bruce Yandle on Bootleggers and Baptists

We have previously mentioned Bootleggers and Baptists. Baptists provide a public argument with moral appeal. Bootleggers have an economic interest and give inconspicuous support to the cause advocated by the Baptists. Now here is a talk by Bruce Yandle on Econtalk.

He makes the point that whenever politicians make laws that mandate a particular technology, we should be very suspicious. Why should politicians favor a particular technology, rather than specify standards that must be met? A mandated technology will favor manufacturers of that technology, and stifle innovation in alternative technologies.

An example is the catalytic converter in cars. Honda actually manufactured a car that met the standards without a catalytic converter, but since the catalytic converter was mandated, Honda still had to install catalytic converters in all their cars.

As an alternative to top-down regulatory law, Bruce Yandle suggests common law which allows people to sue others for imposing costs on them.

Much alarmist environmental advocacy can be understood in terms of Yandle’s idea. The purpose is to goad the state into imposing regulations, or worse, mandated technology solutions – yes to biofuels, no to nuclear power. In the case of biofuels, the Bootleggers are the farm lobby and the venture capitalists.

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