segunda-feira, novembro 19, 2012

Regime Uncertainty

Regime Uncertainty por Robert Higgs:
Regime uncertainty pertains to more than the government's laws, regulations, and administrative decisions. For one thing, as the saying goes, "personnel is policy." Two administrations may administer or enforce identical statutes and regulations quite differently. A business-hostile administration such as Franklin D. Roosevelt's or Barack Obama's will provoke more apprehension among investors than a business-friendlier administration such as Dwight D. Eisenhower's or Ronald Reagan's, even if the underlying "rules of the game" are identical on paper. Similar differences between judiciaries create uncertainties about how the courts will rule on contested laws and government actions.

For another thing, seemingly neutral changes in policies or personnel may have major implications for specific types of investment. Even when government changes the rules in a way that seemingly strengthens private-property rights overall, the action's specific form may jeopardize particular types of investment, and apprehension about such a threat may paralyze investors in these areas. Moreover, it may also give pause to investors in other areas, who fear that what the government has done to harm others today, it may do to them tomorrow. In sum, heightened uncertainty in general — a perceived increase in the potential variance of all sorts of relevant government action — may deter investment even if the mean value of expectations shifts toward more secure private-property rights.

Regime uncertainly is a complex matter. No empirical index can capture it fully; some indexes may actually misrepresent it. Only the actors on the scene can appraise it, and their appraisals are intrinsically subjective. However, by assessing a variety of direct and indirect evidence, analysts can better appreciate its contours, direction, and impact on private investment decisions.

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