Lindblom - The Market System - Afghan Journalists' Committee

260 Thinking About Choicespositive performances they want from millions of citizens.There are better alternatives.In one, the state buys the performances it wants just asyou and I do when we pay a hairdresser to cut our hair. Directlyor through contracting enterprises, it buys the variedperformances necessary for new highways, medical careand production of food for the poor. And it buys or hires thetools and equipment people need in order to do what theyare paid to do.Thus the purchase, simple as it is, is a powerfully andprecisely effective governmental administrative tool. As anadministrative device, it is in most cases superior to command—moreprecise, more widely usable, less frequentlyescaped, and far simpler in use.Two other common methods by which governments inducepositive performances operate through altering theprices that shape the behavior of citizens. One way to do sois subsidize: subsidies to apartment construction, healthcare, shipping, farming, or any other industry producingservices or goods for which markets and prices are alreadyestablished. The subsidy supplements the purchase as afundamental administrative instrument.If subsidies can induce desired performances, an easyinference is that specific or targeted taxes can discourageperformances not desired. Taxes on goods and services can,for example, curb polluting industrial emissions or specifickinds of international financial transactions. The tax thensupplements the purchase and the subsidy as administrativeinstrument.For whatever collective purposes the government mightintend, ranging from national defense to beautifying thelandscape, the administrative trio—purchase, subsidy, andtax—is at hand. Thus state purchases of recreational areas