Tuesday, February 8, 2011
Eye-wateringly expensive
This is a great article on the ethical problems that other countries face. Government officials have basically made it impossible for new companies to sell their products in Angola through bribes and what not. The author talks about how incredibly expensive everything was in the city because the government and their connected firms are holding onto extremely large profits. The last little story about a watermelon was kind of humorous but also sad that an economy can be so corrupt.
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5 comments:
Market failure, a term that is often used very loosely. Don Boudreaux described market failure as the failure of institutions within an economy to allow the functioning of the market.
Such corrupt governments are established to create and maintain inequality, by the ruling classes.
The market is not allowed to act freely. There are huge barriers to entry and, as previously mentioned, the accepted and anticipated corruption throughout the country is preventing true prices from being reflected. Such outrageous prices may result in social unrest in Angola.
It is unbelievable to see what actually goes on in some countries. These outrageous prices cannot go on for much longer or the citizens and visitors of Angola will fight back. It seems as if the judicial system is corrupt as well. A man has all the evidence he needs, yet the judge dismisses the case. Come on. A $100 for a melon.
As we were told by our guest speaker today in class, it is extremely hard to deal with a country as corrupt as Angola. Organizations like USAID and UN work towards finding a solution for outrageous situations like the one described in this article but it is hard to succeed when the local government is benefiting from the market failure.
This incredible to see such corruption going on in these countries. Being a US citizen we don't see it as much. However, I agree with Eric, because I would imagine that the people will at some point revolt against this corruption, and perhaps an outside nation will support the move of the people to fight back. Hopefully the UN can figure out ways to help this economy get back on track, but I agree that this is difficult with the existing market failures.
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