Re: California

["Leigh Harkness" <Leigh@xxxxxxxxxxxxxxxxxxxx>]

Sven

You wrote:

> This theory already exists. Every 100-level micro student learns it.

My frustration is not so much with the students, but the practicioners.  Its
good to hear that students are learning their economic theory.  But how long
before practicing economist put these theories into practice.

Ricardo developed the theory of comparative advantage nearly 200 years ago.
Yet today we still have the IMF and World Bank advising countries to impose
policies based upon the theory of absolute advantage.  They tell countries
to cut costs to improve their trade performance.

Similarly, Keynes explained how balance of payments problems were caused by
excess demand yet there are economists advising countries that it is a price
or exchange rate problem.

And now we have theories that tell us that monopolies can be optimal
entities to provide certain services but people claiming to be economists
telling us that we need to create competition in those industries.

It is no wonder that in this world of so much economic enlightenment,
enlightened economies are amongst the badly performing.
Regards

Leigh