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

["Henry C.K. Liu" <hliu@xxxxxxxxxxxxxx>]

WSJ Thursday October 7, 2002

Did Washington Set Stage for Turmoil?
Policy makers have been pursuing deregulation for the last quarter-century.   With
five momentous decisions, Washington may have set the stage for the current
business turmoil.

mongiovg wrote:

> 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