Market vs Government
Nicely summed up by DeLong — about Krugman – on balancing the roles of market and government: “Paul Krugman loves the market more than any other economist I know–in a “tough love” sense. That is, he’s not one of those on the right who thinks that market failures don’t exist, pretends that every market everywhere functions perfectly, and doesn’t care much about how markets really work. He’s not one of those on the left who thinks that market failures are unfixable, and that command-and-control is nearly always and everywhere a better alternative.
“He’s one who believes that market failures are dangerous things that can be neutralized: smart reorganizations of property rights, or small steps that put the government’s thumb on the scale to improve incentives, or tweaks to the legal structure that rule certain kinds of contracts out and other kinds of contracts in will, he thinks, almost always turn the market into an effective and efficient social planning and organization mechanisms that everyone can love. His is a “tough love” approach to markets–and it is a sign that he cares and that he has great faith in Adam Smith.“