Friday, October 06, 2006

Agricultural law and the law of universal service

This New York Times article on federal subsidies for rural commercial aviation serves as a reminder that the law of universal service, sprawling as it is, properly constitutes a branch of agricultural (or rural) law in its own right.

Agricultural law is rightly described as a body of legal exceptions. Boondoggles for the boonies thus beg the question: Are these benefits -- and the vast legal apparatus needed to sustain them -- even remotely justifiable in a world of scarce resources and urgent needs?


Anonymous D. Daniel Sokol said...

This illustrates a classic public choice problem in our legislative process. Ideally these exceptions would not exist. Given that they do, the most effective means of overcoming them ex ante is through competition advocacy by our friends in the antitrust agencies. Additionally, sunset provisions increase the cost for special interests to participate in the political battle to get such handouts in the first place.

If there are real universal service needs, they require more targeted policies that remove the incentives for inefficient resource allocation.

10/06/2006 11:36 AM  

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