Stock market bubbles and busts are a natural and essential part
of the market process that policymakers should not seek to
control, argues author Robert Miller in a new study,
railway.com* published by the IEA. Miller's research involves a
comparative analysis of the 19th century railway and late 20th
century information and communications technology (ICT)
revolutions. He argues that new technological discoveries give
rise to great uncertainty when applied in business ventures.
Some ventures will fail and some succeed. The stock market boom,
leading to the substantial over valuation of some ventures is
part of the process of discovering the best business ventures,
technologies and applications. Capital will be allocated to
ventures that fail but we do not know, until they are tried,
which those will be. Without the investment in ventures that
ultimately fail, we would not know which technologies and
businesses would add most value in the long term. The process of
stock market boom and bust is an indication th