Are budget deficits bad for an economy? This question has perplexed economists for centuries. Historically, three schools of thought have emerged on this matter. One school takes the position that deficits have adverse influence on inflation, interest rates and private investment. As yearly...

In a partially reformed economy, distortions beget distortions. Segments of the economy which are freed from centralized control respond to the rent seeking opportunities implicit in the remaining distortions of the economy. The battle to capture, and then protect, these rents leads to the...