Re: Paul D. on V. Smith in the WSJ

[mongiovg <mongiovg@xxxxxxxxxxx>]

Sorry for the delayed reply. The conversation appears to have veered off of
the 2002 Nobels and into discussions of the energy market and the
interpretation of Keynes.  Just a brief response to Paul, on the old topic.

Paul's comment is another non sequitur.  Smith's WSJ piece is mainly
mainstream boilerplate, and in it he made no points that derived from the work
that got him his Nobel. Peak-load pricing may be a sensible idea is some
contexts, but one doesn't need to be a neoclassical economist to endorse it;
and opposition to it isn't compulsory for non-mainstream economists. Aside
from Smith's (hardly novel) pitch for peak-load pricing, the WSJ piece was
pretty lame, and I'm inclined to agree with Henry Liu's assessment.

But, as I say, Smith's WSJ op-ed had little to do with the work for which he
won the Nobel, and therefore has little bearing on our earlier discussion of
that work. I certainly never suggested that Smith was not fundamentally a
"mainstream economist"; nor did I suggest that he was ideologically sympatico
with progressives: until I read the WSJ piece, I had no idea what his
ideological leanings were. Anyway, none of it really matters to my main point,
which is that the work that was honored by the Nobel committee is potentially
problematic for a good deal of conventional economics. Would Paul have
considered his own case weakened if Smith had come out in favor of more energy
sector regulation (as some orthodox economists have done)?

Gary


>===== Original Message From paul davidson <pdavidson@xxxxxxx> =====
>.  If Gary Mongovi still believes that Nobel prize winner Vernon Smith is a
>gift horse for heterodox views he should read Vernon Smith's op-ed Wall
>Street Journal piece in today's (October 16) issue -- where Smith argues
>that all the electrical energy problems in California are the result of
>government regulation and if there was only a free market in electrical
>energy the optimal result would occur.
>
>With gifts like that who needs suicide bombers?
>
>Paul