space (i.e., where we actual stand)

[DORR@xxxxxxx]

I am not about to jump into Gil and Ajit's debates on GE and Sraffa.  Not
my cup of tea.  But something Jim Devine said, along with the fact that I
am teaching Urban this quarter, brought up on of my ongoing peeves.

On march 2, Jim Devine said:
> (Of course, time is another problem for
>Walrasians: they can't deal with historical (i.e., real-world)
>time, but only logical time.)

At least as important as real time is real space, i.e., the real lacation
of real economic activity. Neoclassical theory implicitly assumes that all
activity, production, distribution, the auctioneer, exist at a single point in
space.   I believe that *every* econ grad. student should be required to
take a course in Urban, that includes location theory.  The addition of real
space to the standard neoclassical model guarantees that perfect competition
is *logically* impossible.  The best the neoclassicals can hope for is
imperfect competition.  Bottom line, no firms are efficient in the standard
sense, and no firm produces the optimal amount of output.  One had better
like the second best, because the "best" is impossible.

Doug Orr
dorr@xxxxxxx