To: Peter Dierks who wrote (2489 ) 10/10/2006 12:47:34 PM From: TimF Read Replies (2) | Respond to Subsidies aren't the only type of support. The difference is a matter of definition. The net effect can possibly be the same. When you said "many government interventions are intended to be beneficial to society" the statement implied that a patent was of equivalent value to society as other government interventions. I steadfastly believe "That government which governs least governs best." Government intervened once to create a patent system (and since has tweaked the system periodically since then). On the other hand things like "targeted tax cuts" tend to distort systems and produce inefficient results. en.wikipedia.org )but many targeted taxes or tax cuts aren't even an attempt to implement this idea, and when they are an attempt they can often still do more harm than good. What is perceived as an externality may not be one, even if it is it can be hard to impossible to set the tax rate correctly (and often no attempt is made, instead such taxes are raised more and more to bash the perceived bad thing that is taxed), and such taxes increase the complexity of the tax code and increase government control over people. I might support a well implement pigovian tax as an alternative to command and control regulation, when you have a situation where something is, and perhaps has to be done, but even in these cases such taxes are not without problems, and implementing one "good" tax might possibly lead down a slippery slope to more and more such specific taxes.
