Check into the "law of unintended consequences", it works in both cases.


Thanks. I had a look. I hear business people talk about negatives on the upside and positives on the downside. Unintented consequences sounds kind of similar, but on a bigger scale.

I'm not an economist (no, really), so would love some debate on Capped Capitalism as a concept: a trade off between incentive and moderation?


Many of the other replies have already begun hinting at the problems with capping. Here are some quotes from Wikipedia:

"Discussions of unintended consequences usually refer to the situation of perverse results. This situation often arises because a policy has a perverse incentive and causes actions contrary to what is desired."

and:

"Perverse results

* The Streisand Effect occurs when an attempt to censor or remove a certain piece of information (such as a photograph, document, etc.) instead causes the information to become widely known and distributed. The fact that a piece of information is being restricted assigns to it a previously nonexistent value in the eyes of the public."

I included the second quote because it shows quite clearly what a cap of any kind actually does: restriction assigns a valude previously nonexistent. Translation, if we place a 10% cap of some kind then a "black market" is created for any type of opportunity that does better. This is like proposing economic prohibition - surely a bad idea....