Saturday, 23 June 2012

Unintended Consequences

Governments (bless them!) often do things with good intentions.. but often fail to think through the unintended consequences of their actions.

Take energy subsidies as an example. Quite a few governments subsidise energy prices ... to help businesses be more competitive, perhaps.

However, business will only take a cold, hard look at energy usage when prices are high ... so keeping prices artificially low means more energy is used than should be - with consequences for both energy stocks and for the environment.

Good intention. Bad result.

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