Produção científica

The Myth of Under-provision of Science by the Free Market

By Anita Acavalos

One of the recurring myths propagated by today’s mainstream economists is that scientific research requires government funding in order to give society the maximum contribution possible. They start from the correct argument that scientific research is a fundamental link in the chain leading to development, but arrive at the incorrect conclusion that due to its significance it necessitates government funding. This is due to the incorrect assumption that not enough research will be provided by the free market. However, this conclusion is based on faulty economic theory. The two biggest mistakes economists make when it comes to scientific research is that they assume that it is a so-called ‘public good’ and base their conclusions and analysis on a theory that neglects the role of the entrepreneur in this field. This paper aims to show that both of these arguments are wrong: not only is scientific research not a public good but also the entrepreneur, guided by profit and loss, is the most effective decision maker when it comes to the crucial questions of how much research is needed and how it should be provided. The fact that the entrepreneur works as a coordinator, guiding resources in their correct uses and making decisions about how scientific research should be carried out, makes the free market a much more efficient and effective provider of scientific research.
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