March, 2020

Government Intervention Induced Structural Crises

Exploratory Notes on the Patterns of Evolution and Response
  • Paul Dragos Aligica

    Senior Fellow, F. A. Hayek Program for Advanced Study in Philosophy, Politics, and Economics
  • Thomas Savidge

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Read the chapter here.

This chapter examines long-term crises which are induced by the government’s intervention in the structure of the economy when a certain set of structural changes in the economy sets into motion a series of developments that sooner or later lead to what the technical literature has called the “economy of shortage” or shortage economy. This chapter discusses the particular case of Venezuela and several examples of bottom-up responses in Venezuela, as reflected in mass media, in an attempt to get a better sense of the nature and dynamics of the bottom-up responses to structural, shortage economy crises induced by the state.