Author: Barry ZalmaPublisher: Independently Published
ISBN: 9781098910303
Category :
Languages : en
Pages : 228
Book Description
The concept of unintended consequences is one of the building blocks of economics. Adam Smith's "invisible hand," the most famous metaphor in social science, is an example of a positive unintended consequence. Most often, however, the law of unintended consequences illuminates the perverse unanticipated effects of legislation and regulation. In 1692 the English philosopher John Locke, a forerunner of modern economists, urged the defeat of a parliamentary bill designed to cut the maximum permissible rate of interest from 6 percent to 4 percent. Insurance is controlled by the courts, through appellate decisions, and by governmental agencies, through statute and regulation. Compliance with the appellate decisions, statutes, and regulations-different in the various states-is exceedingly difficult and expensiveThe business of insurance is, unfortunately, subject to the law of unintended consequences as if it were on steroids.