A general frame I often find comes in handy while analysing systems is to look for look for equilibria, figure out the key variables sustaining it (e.g., strategic complements, balancing selection, latency or asymmetrical information in commons-tragedies), and well, that's it. Those are the leverage points to the system. If you understand them, you're in a much better position to evaluate whether some suggested changes might work, is guaranteed to fail, or suffers from a lack of imagination.
Suggestions that fail to consider the relevant system variables are often what I call "second-best theories". Though they might be locally correct, they're also blind to the broader implications or underappreciative of the full space of possibilities.
(A) If it is infeasible to remove a particular market distortion, introducing one or more additional market distortions in an interdependent market may partially counteract the first, and lead to a more efficient outcome.
(B) In an economy with some uncorrectable market failure in one sector, actions to correct market failures in another related sector with the intent of increasing economic efficiency may actually decrease overall economic efficiency.
I think this is closely related to the more colloquial concept of "necessary evils". I always felt the term was a bit of a misnomer--we feel they are evils, I suspect, because their necessity is questionable. Actually necessary things aren't assigned moral value, because that would be pointless. You can't prescribe behavior that is impossible (to paraphrase Kant).
As a recent example, someone argued that school bullying is a necessary evil because bullying in the adult world is inevitable and the schoolyard version is preparation. In that case it seems there was a sort of "all-or-nothing" fallacy, i.e., if we can't eliminate it, we might as well not even mitigate it.
Yeah, a lot of "second-best theories" are due to smallmindedness xor realistic expectations about what you can and cannot change. And a lot of inadequate equilibria are stuck in equilibrium due to the repressive effect the Overton window has on people's ability to imagine.
Yeah, a lot of "second-best theories" are due to smallmindedness xor realistic expectations about what you can and cannot change. And a lot of inadequate equilibria are stuck in equilibrium due to the repressive effect the Overton window has on people's ability to imagine.