The distinction between good and bad intervention
has been noted also in the trade policy debate. For
instance, Bhagwati (1988) argues that policies based
on prescriptions rather than proscriptions generally
produce better economic performance. One reason is
that the latter types of intervention tend to stifle initiative
and hurt entrepreneurship and growth, whereas
the former leave large areas untouched and also allow
people to do what is not formally prescribed. Another
reason is that proscriptions tend to divert resources
into unproductive efforts to evade the rules.