A Grande Estagnação - "regime uncertainty"

Regime Uncertainty: Some Clarifications

Mises Daily:Monday, November 19, 2012 by Robert Higgs

In a 1997 article in the Independent Review ("Regime Uncertainty: Why the Great Depression Lasted So Long and Why Prosperity Resumed After the War") I argued that a major reason for the incomplete recovery of private investment during the latter half of the 1930s was "regime uncertainty." By this, I mean a pervasive lack of confidence among investors in their ability to foresee the extent to which future government actions will alter their private-property rights. In the original article and in many follow-up articles, I documented that between 1935 and 1940, many investors feared that the government might transform the very nature of the existing economic order, replacing the primarily market-oriented economy with fascism, socialism, or some other government-controlled arrangement in which private-property rights would be greatly curtailed, if they survived at all. Given such fears, many investors regarded new investment projects as too risky to justify their current costs.
During the past several years, I have argued that a similar, if somewhat less extreme fear now pervades the business community, which explains at least in part the sluggish pace of the current economic recovery.
Mais