Greg Mankiw's Blog: Rogoff joins the Pigou Club: "Rogoff joins the Pigou Club"
A while back, Greg Mankiw gave four reasons not to join the Pigou Club:
1. You deny the existence of these externalities as a type of market failure...
2. You recognize the externalities but you don’t think the government should try to respond to them. You are such a believer in small government that you are willing to live with inferior economic outcomes, such as pollution and congestion.
3. You recognize the externalities, think the government should try to correct them, but think the current low taxes we put on gasoline are sufficient...
4. You recognize the externalities but think the government should try to correct the market failure through regulations (such as CAFE standards) or through market-based solutions that do not raise government revenue (such as cap-and-trade systems)...
The Pigou Club
Bryan Caplan Politely Declines to Join the Pigou Club - Yeah, he might have better ideas!
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