Debt forgiveness regimes produced the same moral hazard, as authoritarian governments considered forgiveness as a free pass to continue to steal from their peoples futures.
Critics question whether problems with adverse selection, moral hazard, information asymmetries, demand inducement, and practice variations can be addressed by private markets.
Moreover, the moral hazard problems associated with implicit public support may amplify risk taking, reduce market discipline, create competitive distortions, and further increase the probability of distress.